The Standard » interest rates

Vampire Economics: The Reserve Bank Act

The Standard — Fri, 19 Aug 2011 01:03:49 +0000

I came across this blog called Howdaft written by Darkhorse recently. It consists of five posts written in June. Five of the best pieces of leftwing economic thinking you'll see anywhere - something we've been short on recently. I've tried to contact Darkhorse, but no luck. If you're out there, drop us a line. In the mean time, here's one of the posts.

Widening movement for monetary policy reform

Marty G — Thu, 24 Jun 2010 11:15:04 +0000

Unique in the world, we task our Reserve Bank with only one goal - keeping inflation in the target range - and give it one blunt tool to achieve it. Adding other objectives would bring us into line with other countries and giving the Bank better tools is long overdue. We need a smarter, more sophisticated approach to monetary policy. It is great to see the Left pushing for it.

Pedal to the metal but still no traction

Steve Pierson — Wed, 28 Jan 2009 23:43:07 +0000

Another review of the Official Cash Rate, another record cut. This time, it’s a 1.5% cut bringing the OCR to 3.5%. That’s the lowest rate since the OCR was introduced in 1999. Good news for those with floating rate mortgages (not so good for the 80% of mortgagees with a fixed rate) and an opportunity for me to feel ...

Slash and pray

Steve Pierson — Wed, 03 Dec 2008 21:05:39 +0000

The Reserve Bank has cut 1.5% off the official cash rate, bringing it down to 5%. The rate has now been cut 2.5% in just six weeks, an unprecendented slashing. Mortgage rates will drop as well, but perhaps not by as much because the banks (excluding Kiwibank) have to borrow most of their money from ...

Reserve Bank drops OCR 1%

Steve Pierson — Wed, 22 Oct 2008 20:02:38 +0000

The OCR is down from 7.5% to 6.5%. That’s an unprecendented cut in one go and further confirmation that we are entering tough economic times. Inflation has been high but the Reserve Bank thinks the increasingly likely global recession will remove inflationary pressure. Keeping the economy going will be the challenge.

Inflation up but already on way down

Steve Pierson — Tue, 21 Oct 2008 00:18:48 +0000

Inflation hit 5.1% for the year to September driven by the mammoth spike in oil, food, and other commodity which has abated since then, for now. There is nothing that could be done to avoid this impact on New Zealand from international markets. The economy is already in recession, and now would be the worst ...

Bollard cuts the OCR

Steve Pierson — Wed, 23 Jul 2008 22:52:51 +0000

The Reserve Bank has dropped the Official Cash Rate from 8.25% to 8%. Inflation is well outside the Bank’s 1-3% target range but there appears to be a recognition that there’s no point strangling our economy with high interest rates when that can’t bring down international oil and food prices. Don’t expect mortgage rates to ...

Inflation up but interest rates must come down

Steve Pierson — Tue, 15 Jul 2008 00:27:06 +0000

Inflation was 1.6% in the last quarter, 4% annually, the highest in 13 years. Petrol is driving inflation. By itself petrol accounted for a 1.2% increase. Food is the other big increase, also accounting for a 1.2% and that is itself being driven by international oil prices. The price of oil is beyond our control ...

OCR unchanged

Steve Pierson — Wed, 04 Jun 2008 23:37:17 +0000

The Reserve Bank has left the Official Cash Rate unchanged; no-one expected a rate cut this early. It’s encouraging that Bollard has firmly signalled that interest rates will be coming down this year despite projected inflation reaching 4.7% in the September Quarter. There’s no use in the Reserve Bank strangling our economy with high interest ...

National: we’ll borrow for tax cuts for the rich

Steve Pierson — Mon, 19 May 2008 00:30:23 +0000

Discovering National’s policy is a bit like the old art of Kremlinology, when Western intelligence agencies would attempt to discover the inner workings of Soviet politics by looking at who stood next to whom in pictures, and what hand politburo members carried their briefcases in. The latest subtle signs from National regarding its tax policy ...

Time to let interest rates fall

Steve Pierson — Fri, 16 May 2008 01:59:19 +0000

The economy is clearly slowing. Fundamentally, it remains strong with high employment, good wages rises, and strong prices for our exports but employment and retail spending both declined in the first quarter of this year, the housing market is flat, and there is a danger that if the Reserve Bank keeps its foot on our ...

Our bank beats the rest

Steve Pierson — Fri, 02 May 2008 02:34:00 +0000

Today, ANZ and National Bank announced they are lifting their variable mortgage rates another quarter of a percent to 10.95%. That comes a week after the two banks, which are jointly owned, announced a net profit of $520 million in six months, up 7% on the previous period. Yesterday, Westpac announced a $244 million profit, ...