John Key MP National Party Finance Spokesman

08 September 2004

Michael Cullen must explain potential protocol breach

National Party Finance spokesman John Key says Michael Cullen must explain why he appears to have broken all the protocols surrounding interest rate announcements.

In answering a seemingly innocuous patsy question in Parliament today, Dr Cullen said, 'the National Bank Business Outlook observes good news in the economy seems to be everywhere. And although the Reserve Bank raised interest rates today it did so because growth is so strong'.

The problem with that announcement is that the Reserve Bank is due to release that highly sensitive interest rate information tomorrow.

"Dr Cullen has admitted he was briefed by the Reserve Bank, and now seems to have let the cat out of the bag, one day early," says Mr Key.

"This is potentially a concerning breach of the rules which guarantee the Reserve Bank's independence.

"This also has the potential to cause a major distortion in the market place, as investors take advantage of the 24-hour head-start that Dr Cullen has delivered them.

"Clearly, Dr Cullen has some explaining to do," says Mr Key.

ENDS

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