Green Party says it’s time to reform the Reserve Bank Act
Green Party co-leader Russel Norman told TVNZ’s Q+A programme today that “jacking up the OCR” is not the only answer to the threat of inflation.
He said the Green Party wants a broader approach to monetary policy.
It would also use Government tools to target the sectors where there is inflationary pressure – like housing and electricity.
“What you need to do when you're dealing with inflation coming out of particular sectors is target those sectors like housing, electricity, where we have big inflationary pressures, rather than using the official cash rate to crush the entire economy, bring up the exchange rate and make the tradable sector really struggle, which is the current strategy of this government.”
“We have some deep lying structural issues in the New Zealand economy, and the answer to them isn't to jack up the OCR every time we see inflationary pressures from the housing market, the answer is to target the housing market with the kind of tools the government has available to take the heat out of that market.”