Jun 19, 2008

Can We Avoid A Recession Now?

The media is giving prominence this morning to Dr Cullen's comments on the probability of negative growth in the first quarter. This should be no surprise, but will hopefully encourage further easing in the currency. While exporters have survived the high dollar surprisingly well, the effects of a high dollar and tougher economic times in markets such as the US and Australia could prove very negative for the sector, particularly for those operating at the premium/luxury product/service end. Of course Dr Cullen's comments are also targeted at the Reserve Bank. The megaphone is getting more consistent and louder in the message - ease well before the election Dr Bollard. Paula Oliver of the NZ Herald has written this account of Dr Cullen's comments yesterday.