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economic stimulus

Why the government can’t afford to be too stimulating

by Rob Hosking | Wednesday February 11, 2009 | 4 comments

Today’s infrastructure announcements from the government should provide a welcome boost for the economy, even though the $500 million spend is hardly earth shattering.

But too much stimulus - and it is not difficult to have too much – and ministers risk an inflationary surge and large interest rate hikes just as they head into the next election.

Today’s announcement focuses on spending on roads, housing and schools.