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Hot Topic EARNINGS
Hot Topic EARNINGS
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Political & Economic week ahead: Will the government bail out farmers?

Any suggestion of a bailout needs to be resisted. With special audio feature.

NBR Radio
Mon, 14 Mar 2016

Politics this week looks set to be dominated by the ongoing rumble of reverberations from last week's double hit of economic news. 

The dairy downturn and its political and economic effects are being hotly debated, with opposition parties calling for support packages and emergency summits while the government is – so far – pointing to existing support programmes and saying there is no crisis.

The temptation will be for the government to buckle and to provide some sort of bailout package, The pressure is going to gather force and it needs to be resisted if New Zealand is not to tilt further down the path of subsidising the dairy industry, and in this case subsidising bad businesses. 

Underneath all this the financial markets are still absorbing the implications of last week's surprise official cash rate cut by the Reserve Bank, and deciding whether they will help the economy overall, and will there be more.

Some indication on that last question will come later this week with the latest figures on economic growth.

GDP data is being released late on Thursday morning and will probably show an increase of around 0.7% for the quarter and a bit above 2% for the year.

Other data already released confirms a positive trend although the most recent data – for manufacturing and for services – is for the current quarter and not the quarter covered by Thursday's GDP figures.

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NBR Radio
Mon, 14 Mar 2016
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Political & Economic week ahead: Will the government bail out farmers?
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