Thursday, April 10, 2008

Bollard bullish about New Zealand economy

Reserve Bank governor Alan Bollard yesterday talked up the New Zealand economy, saying people should not over-react to the economic downturn, a day after the gloomiest business confidence survey in 33 years pointed to a growing risk of recession.

"Banks, businesses and households alike need to recognize the new external environment, and adopt a cautious approach," he said in a speech to the Marlborough Chamber of Commerce. But he added that they shouldn't go into "hibernation", as "the underlying economy remains robust".

Although the international credit crisis had resulted in banks having less cash available for companies to borrow, he urged businesses not to slow down on "quality investment".

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