Articles tagged Reserve Bank Act

Labour Finance Spokesman David Parker has again rejected calls from Economic Development Minister Steven Joyce to specify how much of an increase in the KiwiSaver contribution rate would be needed to have the same effect as a one percentage point increase in the Reserve Bank's Official Cash Rate (OCR).

The Reserve Bank believes the New Zealand dollar is unsustainably and extremely high, but it is not currently considering intervening to pull it down because the market is too liquid and a lower currency would clash with its aim of tightening monetary policy to contain inflation.

The hawkishness of Reserve Bank's forecasts yesterday and Governor Graeme Wheeler's clear reluctance to intervene in the New Zealand dollar saw the currency spike more than a cent higher to touch 86 USc overnight. The NZ dollar rose briefly yesterday to a record post-float high of 80 on the Trade Weighted Index.

Prime Minister John Key has denied his decision to call a September 20 election was designed to reduce the electoral impact of interest rate hikes, which are expected to start on Thursday. He also accused Labour leader David Cunliffe of 'playing games' with the independence of the Reserve Bank.