Comments

David Thompson Posted:
So very, very true. It beggars belief that we consider ourselves to be a developed nation when so much of our economy is based on selling milk powder or logs. BTW, I own a Plinius amplifier (my second) that drives a set of Theophany speakers.
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David Thompson Posted:
A robust but sobering report. It concerns me that confidence is rising, yet sales and exports are down and "manufacturers and exporters are still lagging behind other sectors". Surely we should wait until we're earning more money before we start spending more?
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siemens Posted:
Yes true! The only thing that will never die in this world is the nature and its science behind it. Great post.
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Kieran Ormandy Posted:
Thanks for the question Steven, Germany has seen increases in manufacturing employment since 2009, and Switzerland has had stable manufacturing employment between 2006 – 2011, even in the face of ongoing Euro-zone issues. Korea has seen increases in manufacturing employment since 2008 and Israel experienced large increases since 1998, while being stable over the last 4 years. Singapore has had increases in manufacturing employment over the last two years. These countries all value their manufacturing sectors and work to protect them, this is reflected in the above numbers and their performance through the GFC. Note data around the above examples was sourced from OECD labour market stats.
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John Walley Posted:
Point one: you should have no doubt what our Association says publically represent the views of our members. Point two: we don’t knee jerk responses, if you trace back our comments around NZPower you will see them link all the way back to our research in 2004 and 2005. All that material is fully linked from our comments above. Point three: you will note our comments on major users, sadly the same advantage does not accrue to smaller industrial users. The perverse incentives of the LRMC approach in all this are well known. Point four: the NZMEA is not like any other Association in New Zealand we admit only manufacturers and exporters into membership, and our public expressions are the views of that restricted membership.
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13/9/11

RBNZ lessons from the Swiss


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The Reserve Bank of New Zealand (RBNZ) should take the Swiss National Bank’s lead at the Official Cash Rate announcement on Thursday and take action on the exchange rate say the New Zealand Manufacturers and Exporters Association (NZMEA). Switzerland, like New Zealand, is a small trade exposed economy that relies heavily on export revenues and they have recently moved to peg their currency to support and maintain the competitiveness of their exporters.

Philipp Hildebrand, Chairman of the Governing Board of the Swiss National Bank made the announcement:
“The Swiss National Bank is therefore aiming for a substantial and sustained weakening of the Swiss franc. With immediate effect, it will no longer tolerate a EUR/CHF exchange rate below one Swiss franc twenty. The SNB will enforce this minimum rate with the utmost determination.”

NZMEA Chief Executive John Walley says, “This is the sort of approach New Zealand needs to take. It does not require a currency peg as the Swiss are using, any number of approaches can be adopted, but whatever the method chosen the same overt commitment to deal with an overvalued currency needs to be demonstrated to get the right reaction from currency markets.”

“As a comparison the RBNZ’s largely hands off approach encourages the currency markets to play that predictability without fears of any sustained intervention.”

“New Zealand must look to advance its own interests as the rest of the developed world are doing – this requires action from the Government and the RBNZ. More of the same don’t scare the horses approach will see an ever declining tradable sector and worsening debt problems as a result.”
 



tags: rbnz, swiss national bank, philipp hildebrand, currency, exchange rate

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Please play the ball not the man.