Immigration Tweak To Curb Inflation 'Window Dressing'
5:41 pm, 05 Jul 2007 Print this story

A move by the New Zealand Government to curb inflation by tweaking immigration numbers is being described by some economists as just window dressing.

Immigration Minister David Cunliffe announced on Thursday that the maximum possible number of migrants for the coming year is to drop from 52,000 to 50,000.

Immigration is seen as one driver of inflation, as new migrants push up demand for housing. Mr Cunliffe says the small reduction in numbers recognises inflationary pressures in the economy and the need to continue to attract quality skilled labour.

Economists say the reduction will have little impact on housing inflation and could make matters worse by putting extra pressure on the tight labour market.

Some economists commended the Government for at least trying to tackle the inflation issue.

However, others said it was misguided, and should instead concentrate on issues around taxation and housing investments.

© NewsRoom 2007

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