12 June 2014
Consider exporters when raising OCR
The needs of exporters must be factored in to any additional OCR rises this year, says BusinessNZ.
This morning the Reserve Bank lifted the official cash rate to 3.25% and intimated more rises would follow.
BusinessNZ Chief Executive Phil O’Reilly said the rise in the exchange rate that followed this morning’s announcement is
not what the economy needs.
“The Reserve Bank clearly expects the exchange rate to fall, given weaker international dairy prices, but exporters
would nevertheless invite caution.
“There is still potential for New Zealand’s economic growth to slow, despite our current enviable rate of expansion, and
inflationary pressures are not widespread through the economy. Current inflationary pressures often stem from central
and local government-imposed regulation in any case.
“In this environment the Reserve Bank should pay heed to the needs of New Zealand exporters and the productive sector
when thinking about and deciding upon further rates rises,” he said.
ENDS