Latest / Best of Business / Jarrod Kerr: Kiwibank chief economist says the Reserve Bank needs to help boost recovery following latest unemployment data

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Jarrod Kerr: Kiwibank chief economist says the Reserve Bank needs to help boost recovery following latest unemployment data · Best of Business

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  Speaker 1: You're listening to a podcast from News Talks'd be follow
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  Speaker 2: The unemployment rate's gone up five point one percent in
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  Speaker 2: the final quarter of twenty twenty four, up from four
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  Speaker 2: point eight percent in the September quarter. Unemployment now the
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  Speaker 2: highest it's been since September twenty twenty, that's when it
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  Speaker 2: was five point two percent. Kee We Bank chief economist
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  Speaker 2: Jared Curves with me, Jared, Good evening, Good evening. So
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  Speaker 2: this is what everyone was expecting. Does that mean we
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  Speaker 2: can continue expecting that the interest rates will come down
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  Speaker 2: in two weeks?
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  Speaker 3: Yeah, exactly. It came in line with expectations. But to
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  Speaker 3: be fair, expectations are pretty miserable and it was an
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  Speaker 3: ugly report, and it does suggest the Reserve Band needs
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  Speaker 3: to do more to put this economy into recovery mode.
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  Speaker 2: More than what they told us they'd do, in other words,
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  Speaker 2: more than half a percent.
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  Speaker 3: Absolutely, I think they will deliver fifty in February, but
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  Speaker 3: we're thinking about where they end this year. They're telling
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  Speaker 3: us I'll cut to three and a half percent. We're
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  Speaker 3: telling them that we think they need to cut to
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  Speaker 3: three percent by when the end of the year. Yeah,
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  Speaker 3: by the middle of this year, end of this year.
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  Speaker 3: The main point is that interest rates are still restrictive.
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  Speaker 3: The restraining households, they're restraining businesses. We've seen it in
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  Speaker 3: the labor market. It's time, it's time to take some
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  Speaker 3: of that pressure off.
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  Speaker 2: Is there a point where you get so far in
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  Speaker 2: a rut you can't even begin to see your way out?
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  Speaker 2: And is that where we are now in terms of
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  Speaker 2: consumer confidence in spending.
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  Speaker 3: We were definitely in quite a rut last year. We
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  Speaker 3: are somewhat optimistic that things turn around this year. I
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  Speaker 3: think there's always a way to sort of dig your
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  Speaker 3: way out of problems, and we certainly will do that.
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  Speaker 3: It just takes more action from our policy makers.
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  Speaker 2: Growth. I've been looking at the numbers from the Reserve
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  Speaker 2: Bank and from Treasury. They reckon, we're going to go.
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  Speaker 2: This is Treasury from half a percent growth through till June,
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  Speaker 2: so barely registering to three point three percent by June
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  Speaker 2: twenty twenty six. Does that sound highly optimistic to you.
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  Speaker 3: It's kind of in line with what we're expecting. You know,
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  Speaker 3: these rate cuts come through, they'll feed through over the
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  Speaker 3: next six months. You're working off a very low base,
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  Speaker 3: so very low levels, and you start seeing a recovery
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  Speaker 3: into twenty and twenty six. And yeah, we're sort of
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  Speaker 3: pitching the idea that we'll see two to three percent
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  Speaker 3: growth rates into twenty and twenty six. It's definitely possible,
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  Speaker 3: and you know something, we hope that we will see.
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  Speaker 2: I certainly hope we do too. Thanks so much for
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  Speaker 2: your time, Jared, Jared Kirk, Chevybank Chieap Economists.
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