17 Oct 2008

NZX head says Govt needs to act on economy before election

8:53 pm on 17 October 2008

The head of the New Zealand Exchange is calling for Government action before the election to reverse a bleak economic situation.

NZX managing director Mark Weldon says dismal global economic conditions are putting businesses and jobs at risk.

He told Morning Report the Government should encourage businesses to keep investing by dealing with tax for depreciation in capital investment and helping with cash flow.

He also expressed support for the National Party's policy of having 40% of the New Zealand Superannuation Fund invested in New Zealand.

Mr Weldon said he will be surprised if the Reserve Bank does not cut interest rates again next week.

The Official Cash Rate is currently 7.5%.

The New Zealand stock market followed world markets down further on Thursday 16 October. The benchmark NZX50 index closed down 139 points - a drop of almost 5%.

However, it clawed back about a third of those losses on Friday 17 October, closing up 44 points, or 1.6%, to 2808.