Michael Reddell: Former RBNZ economist says when the RBNZ tries to significantly reduce inflation, it's a recipe for recession
The looming recession could cut deeper than previously thought.
ASB is now forecasting the economy will shrink by about two-percent by early next year, double the contraction it was forecasting three months ago.
Former Reserve Bank economist Michael Reddell says its a plausible prediction.
He told Tim Dower every time the Reserve Bank tries to significantly reduce inflation, it's a recipe for recession.
Reddell says every time inflation has been brought down so quickly in the past, it's led to a recession, usually a severe one.
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