4 Oct 2012

Lower bank rate urged

8:28 am on 4 October 2012

Business New Zealand is urging the Reserve Bank to cut interest rates to make life easier for manufacturers.

The high value of the New Zealand dollar is blamed for hurting exporters.

Business NZ says there's no doubt manufacturers are struggling and the bank should follow the lead of the Reserve Bank of Australia, which lowered its rate on Tuesday to 3.25%.

Business NZ chief executive Phil O'Reilly says it's not necessarily about trying to take pressure off the dollar, but the Reserve Bank does have to take into account that the economy is slowing.

However, he does not believe the bank should try to manipulate the dollar.

The new Australian rate is the lowest since October 2009.

The Reserve Bank next reviews the official cash rate on 25 October. It was set at 2.5% on 10 March, 2011.