English and PM 'locked at the hip'

John Key. Photo / Mark Mitchell

Prime Minister John Key yesterday rejected suggestions of wide differences between him and Finance Minister Bill English on economic recovery.

Mr Key also gave his "personal" view of how the recovery would happen - the world would be flooded with liquidity associated with printing money and the recovery would be a lot quicker than people thought.

Mr English told TVNZ's Q+A it was unlikely New Zealand would come out of it aggressively; Mr Key told the same show he thought New Zealand would come out aggressively.

Mr Key said yesterday that "we have the same strategy".

"We are absolutely locked at the hip in terms of what is required to take New Zealand out of this recession and where New Zealand needs to go to grow productivity and make New Zealand economically strong [in recovery]."

Mr Key said the timing of recovery was "a deeply subjective sort of view" and he believed it would be by the end of this year.

He said there were "two views" - one that suggested growth would be quite aggressive and one that suggested it would be "a slow grind".

"We are in quite uncharted territory but my own personal view is that what we are going to see is a flooding of liquidity around the world; you've seen this quantitative easing [money printing] taking place in the United States and in other parts of the world and if you want my view, we will start growing quicker than people think.

"I think it will present a substantial inflationary issue in a few years, but I think we will come out of it quicker."