time to follow through 3 october 2005 contents page 2 economic overview while the nz economy expanded 1 percent in june quarter a deceleration remains play however key issue facing reserve bank over coming years is dichotomy between inflation and growth with s focus squarely on former comment current account deficits longer dated yields weaker dollar will not materially improve deficit domestic demand required interest rates both monetary policy higher risk premium look set role 5 market viewpoint pricing endorsing 25 basis point move from an theme transfixing global sentiment strategy remain short ride trend 7 rate poo or get off potty ocr decision more than choice hiking if fails despite repeated warnings then we question how could justify maintaining tightening bias 8 currency yield once again
