Progressives implacably oppose dollaroo

Progressives are implacably opposed to currency union with Australia, Progressive deputy leader Matt Robson says.

At the last election, Progressives made stopping currency union one of the party’s top ten priorities in government.

“This is a critical issue for anyone interested in jobs and development for New Zealand,” Matt Robson said.

“Control of our own currency is crucial to maximising job opportunities and development in New Zealand.

“Under a common currency, jobs would be lost in New Zealand to control Australian inflation. There would be less flexibility for NZ-specific responses to global developments.

“For example, if there were a housing boom in Sydney, perhaps caused by people moving there from regional New Zealand under a National-Act government, then interest rates would be increased to reduce house price inflation in Sydney – further crushing regional New Zealand.

“If the Australian federal government hypothetically decided to run deficits with big increases in spending or irresponsible tax cuts, the inflationary effect would be met with higher interest rates in New Zealand. Why should New Zealand homeowners or businesses have to pay higher interest rates because of economic decisions made by a government which we could neither vote for nor against?

“There are some real concerns that the New Zealand dollar is currently over-valued. The correct response to that is to run monetary policy better in New Zealand – not to give up on running it at all,” Matt Robson said.

The progressives have a detailed discussion paper on common currencies. It’s available here: http://www.progressive.org.nz/policy/policy-currencyunion.htm

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