Low spending, lower interest rates

Quote of the day:

Reserve Bank Governor Graeme Wheeler can only show restraint on interest rate rises if New Zealanders show restraint of their own.

This is Rob Hoskings’ introduction to a column headlined: Want low interest rates? Keep lid on spending.

We all have a role to play in that through our own spending and saving and also what we expect of government.

National has made it quite clear it won’t be doing an election-year lolly scramble.

The return to surplus hasn’t been easy and it’s not going to blow the hard-won gains by profligacy.

Opposition parties try to give the impression they accept the wisdom of careful management of public funds. But their strong attacks on every single measure National has introduced to curb spending and their propensity for big-spending promises show they don’t really mean it.

They’re wringing their hands over the Reserve Bank’s small increase in interest rates from historic lows and today’s expected rise, while not resiling from the borrow and spend policies of the noughties which pushed interest rates into double figures and led New Zealand into recession before the rest of the world.

New Zealand has recovered well from the recession, but continued good economic health requires more of the prescription of increased savings and investment and restrained spending from all of us.

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