Simon Bridges says unchanged OCR shows Reserve Bank Governor's shaken faith in the economy

National Party leader Simon Bridges has continued his attack on the Government's handling of the economy, saying the Reserve Bank's reluctance to raise the Official Cash Rate speaks more than words.

The unchanged OCR was not expected by the market, and the New Zealand dollar has fallen from about US$67.50c to about US$65.75c, as of this morning, since the Reserve Bank made its announcement on Thursday.

Mr Bridges, speaking this morning to TVNZ 1's Breakfast, said Reserve Bank Governor Adrian Orr's decision to keep the OCR at its current historic low of 1.75 per cent shows he is not confident in the economy.

A graph showing business confidence in New Zealand for the past five years, up until June 2018.
A graph showing business confidence in New Zealand for the past five years, up until June 2018. Source: ANZ Bank New Zealand/Tradingeconomics.com

"The reality is he has kept interest rates lower for longer than other places around the rest of world," Mr Bridges said.

"That is the biggest vote of no confidence in the economy ... that he's got."

Mr Bridges said falling business confidence and rising unemployment are symptoms of the Labour Government's policies, including the recent increase of industrial action and working groups.

New Zealand unemployment statistics to June 2018.
New Zealand unemployment statistics to June 2018. Source: Statistics New Zealand/Tradingeconomics.com

"New Zealand should be booming - it should be 3.5, 4 per cent," Mr Bridges said.

"I don't think we're heading for a recession - but I do think, right at the moment ... her [Jacinda Ardern's] focus should be on plummeting business confidence and the economic downturn."

Mr Orr yesterday told TVNZ 1's Q+A that he assesses business confidence based on business' actions, rather than how they respond anecdotally to surveys.

Mr Bridges says Adrian Orr would have raised the rate if he was confident in New Zealand’s economy. Source: Breakfast

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