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The Economy, Inflation And Interest Rates Dominate Campaign

Fuseworks Media
Fuseworks Media

The economy, inflation and the Reserve Bank's interest rate announcement on Thursday featured on the campaign trail today.

Prime Minister Helen Clark and National's leader John Key both said they did not think inflation figures out today -- 5.1 percent in the September quarter, the highest for 18 years -- would affect the bank's decision.

Miss Clark said fuel and food prices had a big impact on the inflation figures and she thought the Reserve Bank would look through them.

Mr Key predicted governor Alan Bollard would cut the official interest rate, probably aggressively.

Most commentators are picking a 1 percent cut because inflation is expected to come down rapidly in the next few months.

Finance Minister Michael Cullen said economists anticipated inflation would "moderate significantly" and issued a separate statement with assurances the Government was planning to boost the economy in the face of the global slowdown.

He said the mini-budget the Government would bring in after the election -- if it wins -- would create jobs and increase skills.

In other campaign developments today:

* National promised to fast-track the remaining stages of the Waikato Expressway linking the city to Auckland and complete it in 10 years at a cost of $790 million.

Transport Minister Annette King said it was pork barrel politics and National had a terrible record for highway construction.

* New Zealand First leader Winston Peters' proposal to float shares in Kiwibank that only New Zealanders could buy went down like a lead balloon. Miss Clark said the bank was doing just fine and the politician who created it, Jim Anderton, said New Zealanders already owned it through the Government.

Mr Peters said he meant a partial share float which was needed so the bank could expand and take on the Government's $55 billion a year business;

* Labour adverts showing Mr Key making conflicting statements on various issues and questioning whether he could be trusted were dismissed by National.

The party said it wouldn't respond with a similar campaign and would leave Labour to make a fool of itself;

* The Maori Party gave a preview of its Treaty of Waitangi policy, to be released tomorrow. It wants a parliamentary commissioner to ensure the Crown meets treaty obligations and ensure new migrants are educated about it;

* Greens co-leader Jeanette Fitzsimons, 63, bungy jumped off Kawarau Bridge near Queenstown. She said she wasn't brave and about 100,000 people had done it.

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