Time To Cut Interest Rates

"The case is by now well-established for a cut in interest rates," said Council of Trade Unions secretary Paul Goulter today.Paul Goulter said a range of factors supported that view.

"The latest consumer price index data shows that non-tradeables inflation is easing," he said.

"When this is combined with the recent Quarterly Survey of Business Opinion, the effect of the exchange rate, falling export returns, the impact of power prices, ongoing effects of the drought on farm production and SARS, it is clear that a cash rate of 5.75% is too high."

Paul Goulter said the CTU view was that the Reserve Bank should respond to this set of circumstances on 24th April rather than wait until June.