Finance Minister Bill English attended meetings at the International Monetary Fund (IMF) and World Bank recently, and returned reaffirming the Government’s commitment to reducing public debt under 20% of GDP.
He thinks that is the most prudent strategy in these uncertain economic times.
Meanwhile the rest of the world is struggling with stagnant growth despite years of record low interest rates.
In some countries interest rates are now even negative.
Overseas Governments are starting to ask what action they can take in a zero interest rate world, and the IMF is advising them to spend more.
In this Face to Face I talk with Bernard Hickey about these issues and what options New Zealand has to stimulate the economy as interest rates edge towards zero.
Geoff Simmons is an economist working at the Morgan Foundation. This article is here with permission and first appeared here.