Reserve Bank should reduce interest rate

“The Reserve Bank should be reducing its policy interest rate, the OCR”, says CTU Economist Bill Rosenberg in response to the Bank’s announcement today that it is not increasing it.

“It would send a strong signal that the Bank means business on reducing the overvalued exchange rate, and would encourage productive job growth in the many parts of the economy that haven’t benefited from the Christchurch rebuild and expanding construction sector. There is little risk of general inflation. Housing and electricity prices should be dealt with using specific measures.” Rosenberg said.

ENDS

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