The RBA Governor fears further interest-rate cuts will prompt more borrowing... New Zealand’s John Key to step down as Prime Minister...
Losing its coveted AAA rating may be just what Australia needs
(Bloomberg) -- Australia’s economy appears to have entered a stimulus stalemate.
Reserve Bank of Australia Governor Philip Lowe fears further interest-rate cuts will prompt more borrowing from households already carrying record debt and put the nation’s financial system at risk. So it seems easing is off the table.
In the fiscal corner, ruling parties are so terrified of losing the country’s AAA credit score they’re refusing to entertain stimulus to bolster growth and hiring. Veteran Westpac Banking Corp. economist Bill Evans’s solution for breaking the deadlock: a rating downgrade.
If the government “is relieved of its battle to retain the AAA it may be more open to adopting a sensible long-term infrastructure program,” Evans said. “Such a program would boost productivity and while the direct short-term impact on demand might be limited, it is likely to boost the confidence and growth expectations of the business community.”
New Zealand’s John Key to step down as Prime Minister
(Bloomberg) -- New Zealand Prime Minister John Key said he will step down next week and backed his deputy, Bill English, to succeed him.
In a surprise announcement Monday in Wellington, Key said that for family reasons he couldn’t commit to serving a full fourth term as prime minister if his governing National Party wins the next election, due in late 2017. The party will vote on a new leader on Dec. 12, he said, adding he will also resign from parliament next year.
“I absolutely believe we can win the next election, but I do not believe that if you asked me if I was committed to serving out a fourth term, that I could look the public in the eye and say yes,” Key, 55, told reporters. “I’ve given everything I could to this job, a job that I cherish in the country that I love. All of this has come at quite some sacrifice from the people who are dearest to me, my family.”
Since becoming prime minister in 2008, the former global head of foreign exchange for Merrill Lynch & Co. has enjoyed strong popular support as he steered the country through a number of tragedies, including an earthquake that leveled inner-city Christchurch in 2011 and killed 185 people. In close partnership with Finance Minister English, Key oversaw New Zealand’s economic recovery from the global financial crisis and returned the government’s budget to surplus.
‘Say it ain’t so bro’
“It has been an enormous privilege to be prime minister of New Zealand, and these last eight years have been an incredible experience,” Key said. However, too often political leaders stayed too long and he believed it was time for “a refresh,” he said.
Australian Prime Minister Malcolm Turnbull told reporters he had sent Key a short note reading: “Say it ain’t so bro.”
“New Zealand has never been better situated than it is today,” Turnbull told reporters. “That is due to the outstanding leadership that John has shown.”
(Bloomberg) -- Australia’s economy appears to have entered a stimulus stalemate.
Reserve Bank of Australia Governor Philip Lowe fears further interest-rate cuts will prompt more borrowing from households already carrying record debt and put the nation’s financial system at risk. So it seems easing is off the table.
In the fiscal corner, ruling parties are so terrified of losing the country’s AAA credit score they’re refusing to entertain stimulus to bolster growth and hiring. Veteran Westpac Banking Corp. economist Bill Evans’s solution for breaking the deadlock: a rating downgrade.
If the government “is relieved of its battle to retain the AAA it may be more open to adopting a sensible long-term infrastructure program,” Evans said. “Such a program would boost productivity and while the direct short-term impact on demand might be limited, it is likely to boost the confidence and growth expectations of the business community.”
New Zealand’s John Key to step down as Prime Minister
(Bloomberg) -- New Zealand Prime Minister John Key said he will step down next week and backed his deputy, Bill English, to succeed him.
In a surprise announcement Monday in Wellington, Key said that for family reasons he couldn’t commit to serving a full fourth term as prime minister if his governing National Party wins the next election, due in late 2017. The party will vote on a new leader on Dec. 12, he said, adding he will also resign from parliament next year.
“I absolutely believe we can win the next election, but I do not believe that if you asked me if I was committed to serving out a fourth term, that I could look the public in the eye and say yes,” Key, 55, told reporters. “I’ve given everything I could to this job, a job that I cherish in the country that I love. All of this has come at quite some sacrifice from the people who are dearest to me, my family.”
Since becoming prime minister in 2008, the former global head of foreign exchange for Merrill Lynch & Co. has enjoyed strong popular support as he steered the country through a number of tragedies, including an earthquake that leveled inner-city Christchurch in 2011 and killed 185 people. In close partnership with Finance Minister English, Key oversaw New Zealand’s economic recovery from the global financial crisis and returned the government’s budget to surplus.
‘Say it ain’t so bro’
“It has been an enormous privilege to be prime minister of New Zealand, and these last eight years have been an incredible experience,” Key said. However, too often political leaders stayed too long and he believed it was time for “a refresh,” he said.
Australian Prime Minister Malcolm Turnbull told reporters he had sent Key a short note reading: “Say it ain’t so bro.”
“New Zealand has never been better situated than it is today,” Turnbull told reporters. “That is due to the outstanding leadership that John has shown.”
