Latest news with #AdrianOrr
Bloomberg
24-07-2025
- Business
- Bloomberg
RBNZ Chair Says Orr ‘Lost His Cool' With Treasury Officials
Reserve Bank of New Zealand Chair Neil Quigley apologized to a Treasury Department official for the behavior of Governor Adrian Orr less than two weeks before Orr abruptly quit. Quigley and Orr met with Treasury officials on Feb. 20 to discuss the central bank's five-year funding agreement with the government, Treasury said in response to questions from Bloomberg News and other media.
NZ Herald
23-07-2025
- Business
- NZ Herald
John Key is right that New Zealand needs to cut interest rates but we need more than that too
Key warns the coalition risks losing the next election. He says the Reserve Bank got interest rates wrong again – first too low, now too high – and it's crushing the economy. The data backs him. Massey University's GDPLive shows GDP growth at just 0.261% for the quarter and down 0.53% annually. It puts inflation at 2.18%. With dairy booming, most of the economy must be in recession. The Reserve Bank's Nowcast GDP tracker is down 0.288% for the quarter. Key says that with no sign of wage inflation, the Reserve Bank should cut the Official Cash Rate by 100 basis points – from 3.25% to 2.25%. The Taylor Rule that central banks use to guide interest rates indicates the OCR is 50 basis points too high. Key is also right that the central bank's money printing fuelled the inflation that destroyed the last Government. Now, with rates too high, it's strangling growth and may destroy this one. It seems the Government had no plan for replacing former Reserve Bank Governor Adrian Orr. I nominate Key. He's qualified and has the judgment the job demands. If appointed and interest rates are cut, the economy would be growing in election year. If Key is unavailable, appoint the economist who warned that $100 billion in quantitative easing would cause inflation: Auckland University's professor Robert MacCulloch. Internationally recognised for his work on central banking. If the coalition aspires to more than winning elections, it must do what Key never did: tackle why New Zealand is sliding down the OECD rankings. It's not that the world doesn't want what we sell. Dairy prices are excellent, meat sales are solid, and tourism is recovering. We're just badly managed. To lift our standard of living, we must raise our productivity which has been static for a decade. The Treasury's recent analysis highlights that 'New Zealand has much lower levels of capital per worker than OECD peers'. We lag Australia because its compulsory superannuation pumps billions into productive investment. We should have shifted to savings-based super 50 years ago. That's no reason not to do it now. Last week's abandonment of open-plan classrooms was a good start to lifting education standards. Abandoning pupil-led learning would be even better. Health is another failure. We have a Soviet-style monopoly with low productivity. Waiting lists grow despite record spending. More money is not the answer. Singapore achieves better outcomes for less – based on compulsory savings, price transparency, and private providers. We should copy it. One thing Key did achieve was restraining the growth of the civil service. According to the International Monetary Fund, Government expenditure was an estimated 41.39% of GDP in 2023. The 59% of the economy in private hands just isn't big enough to generate the investment, wealth and exports we need. We are over-regulated. The OECD's 2023 Government at a Glance ranked New Zealand last in the OECD for barriers to permits, licences and foreign investment. The Regulatory Standards Bill isn't a nice-to-have. It's essential. Key is also right about the ban on foreign home buyers. Foreigners won't bring their capital or expertise if they're told they can only rent. There are about 200,000 able-bodied adults on Jobseeker Support. That number has barely moved since Key's time, despite job vacancies and social investment strategies. Australia has had a Work for the Dole scheme since 1997. Employment Minister Peter McCardle introduced Work for the Dole scheme in 1998. Labour scrapped it. We should try again. Last year, in an international comparison, New Zealand's economy ranked 33rd out of 37. That makes it a mystery why Luxon waited so long to visit China, our biggest trading partner. And why did the Prime Minister go to a Nato summit in Europe? Every other Pacific PM stayed away knowing the summit would pledge to spend 5% of GDP on defence and criticise China. As New Zealand is not going to do either a PM focused on growth would have stayed at home. We have a bloated bureaucracy focused on political correctness rather than the hard work of delivery. An opposition that thinks New Zealand can tax its way to prosperity. An economy that's 41% government, starved of capital, and bound in red tape. Without reform, we will never climb the OECD ladder. Key's rate cut might win the next election. Only real reform will return New Zealand to the top tier of the OECD.
NZ Herald
18-07-2025
- Business
- NZ Herald
Sir John Key urges 100-basis-point interest rate cut to boost NZ economy
While GDP grew at 0.8% in the first quarter of this year, there are fears some economists fear the second quarter could be negative. The manufacturing and services sectors both remain weak and on top of that, the property market is subdued. Adrian Orr, Reserve Bank Governor between March 2018 and March this year. Photo / Mark Mitchell Key maintained that Orr, who resigned as Reserve Bank Governor in June, mismanaged monetary policy over several years. 'Adrian fixated on getting interest rates to zero,' during the pandemic, Key said. 'Then he fixated on having them too high for too long. 'A lot of the indicators the Reserve Bank looks at are lagging indicators. They're quite late to the party,' Key said. The Reserve Bank held the Official Cash Rate (OCR) at 3.25% on July 9 but hinted heavily in commentary it expects to resume rate cuts later in the year. Acting Reserve Bank Governor Christian Hawkesby won't give an in-person briefing until the August 20 rates review. Financial markets are currently pricing in a 70% chance the OCR will be cut by 25 basis points in August, with a 50% chance of another cut by February 2026. Economists expect the OCR to bottom out at around 2.5% to 3%. 'The best I can do is rent a house?' Immigration Minister Erica Sanford recently said there had been more than 200 applicants to the 'golden visas' introduced in March, with 100 approved in principle so far and more than $1 billion on the table for investments. Applicants have to pledge at least $5 million for 'growth' investments such as start-ups or $10m for 'balanced' investments. Key said 10,000 investor immigrants would be better, but many were put off by the foreign buyer ban in housing. 'If I'm turning up with $100m, are you telling me the best I can do is rent a house?' Key said. 'We're a little country at the bottom of the world. And to make that work, you need foreign capital. You need smart foreigners to come here. You need positive population growth, migration,' Key said. The former PM did not see the foreign buyer ban, championed by NZ First, as keeping house prices down, at least in everyday suburbs. 'If I'm a billionaire in China, I'm not going to wake up and think I want to buy a $800,000 house in Pakuranga,' he said. 'They might buy a $50m property on the lakefront in Queenstown.' Key said agriculture was booming, but New Zealand was stuck in an 'L-shaped recovery, not a V-shaped recovery like after the GFC'. Key saw a turnaround in house prices, fuelled by lower rates, as the key to restoring confidence. 'If you want to get things going, the core of what's wrong is the housing market. The guts of what's wrong is that the housing market is going down, not up,' Key said. 'When house prices go up, everybody tells the pollsters, 'Oh that's terrible, my son or daughter can't buy house. I feel really bad. The technical term for that is 'bulls***',' Key said. 'What they really do, is they say to their wife – or the wife says to her husband, 'God, we paid $1m for this house and it's worth $1.7m now.' Quietly they go, 'Oh, we feel rich. And then they go and borrow a bit from the ANZ and they go on holiday and they upgrade their kitchen, they feel good about life. So when you have a negative wealth effect, they feel bad.' The median house price in Auckland has fallen 3.4% in a year to $990,000, according to figures released earlier this year by the Real Estate Institute. Excluding Auckland, the median price rose 1.7%. As he called for lower rates, Key acknowledged he had skin in the game. 'My son's a developer, so I'm talking a bit from personal experience,' Key said. 'I'm just telling you, we have got so much stuff on hold. We own land all over the show, and we're just sitting there not doing anything. 'He [Max Key] goes, 'Mate, my tradies' – he's got a bunch of these guys on the payroll in different places – 'none of them had Christmas holidays. There's no work'.' It's the tradies, stupid Many tradies were working three-day weeks, Key said. And for the party in power, that was a problem. 'To win an election, you have to win where the tradies live,' Key said. And that meant winning West Auckland. 'Don't worry about Remuera, don't worry about anywhere else,' Key said, tracing similar ground to political commentator Chris Trotter, who once described that archetypal middle New Zealand swing voter as 'Waitākere Man', a blue-collar conservative. 'I'm pretty close to Chris, and I talk to him quite a lot. But I don't try to be his father," former Prime Minister Sir John Key says of his relationship with current PM Christopher Luxon. Photo / Mark Mitchell 'Don't worry about Remuera, you've got to win Te Atatū, you have to win West Harbour, you have to win Waitākere.' Is the former PM passing on his thoughts to his successor? 'I'm pretty close to Chris, and I talk to him quite a lot. But I don't try to be his father. I don't try to tell him what to do,' Key said. Although he had concerns about the current state of the economy, he saw Christopher Luxon's Government ultimately prevailing as things picked up. Key related that he said to Luxon: 'You bet your house against my house: is the economy going to be stronger or weaker by the time of the election in 2026? We couldn't bet because we both thought stronger.' Chris Keall is an Auckland-based member of the Herald's business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
NZ Herald
15-07-2025
- Business
- NZ Herald
Former Reserve Bank Governor Adrian Orr joins Cook Islands Super board
Former Reserve Bank Governor Adrian Orr has become a member of the Cook Islands National Superannuation Fund (CINSF) board. Photo / Mark Mitchell Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech. Access to Herald Premium articles require a Premium subscription. Subscribe now to listen. Former Reserve Bank Governor Adrian Orr has become a member of the Cook Islands National Superannuation Fund (CINSF) board. Photo / Mark Mitchell By RNZ Former Reserve Bank Governor Adrian Orr has become a member of the Cook Islands National Superannuation Fund board. Orr has family links to the Cooks and has supported the fund previously with advice from its formation. Cook Islands National Superannuation Fund (CINSF) chairman Heinz Matysik said Orr was a welcome addition. 'Adrian brings a wealth of industry knowledge and leadership that will strengthen our board,' Matysik said. 'His appointment comes at a pivotal time, as the fund enters its next phase of growth and development.'
RNZ News
15-07-2025
- Business
- RNZ News
Former Reserve Bank boss Adrian Orr joins Cook Islands Super board
Adrian Orr quit as RBNZ governor in March after a dispute over future funding of the bank. Photo: Former Reserve Bank governor Adrian Orr has become a member of the Cook Islands National Superannuation Fund (CINSF) board. Orr has family links to the Cooks and has supported the fund previously, with advice from its formation. Fund chair Heinz Matysik said Orr was a welcome addition. "Adrian brings a wealth of industry knowledge and leadership that will strengthen our board," he said. "His appointment comes at a pivotal time, as the fund enters its next phase of growth and development." The CINSF said Orr had supported uncle and former MP Norman George to get the fund established "Since the fund's inception, Mr Orr has provided strategic and operational support to the board and executive, contributing to the fund's continued development." The board seat is Orr's first public appearance since he abruptly quit as RBNZ governor in early March, after what was later confirmed to be a dispute with the RBNZ board over future funding of the central bank. Orr headed the New Zealand Super for close to a decade, before moving to the RBNZ. The Cook Islands Fund turns 25 this year and has about $300 million in assets under management. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
