RBNZ's Bollard defends rate rises

The governor of New Zealand's central bank, Alan Bollard, has defended lifting interest rates to the highest level in the developed world, citing pervasive capacity constraints and inflation pressures.

The Reserve Bank of New Zealand has raised its cash rate four times by a total of one percentage point since January to 6.0 percent, and has said that the stronger-than-expected domestic economy may force further rate rises.

In response to an editorial by the National Business Review newspaper l