Response to letter writer
Hugh Webb (letter, November 27) is mistaken in his belief that New Zealand could have avoided a foreign-exchange crisis in 1984 by heeding defeated Prime Minister Muldoon’s call not to devalue.
The Treasury and the Reserve Bank had been urging a devaluation since 1982. Muldoon’s mismanagement continued to wreck the economy, and by 1984 devaluation was essential.
He triggered a currency crisis by announcing a snap election, because a devaluation was likely after the election, whichever party won. The day after the announcement, a heavy outflow of funds began, making the need for devaluation urgent.
When he lost the election, Muldoon was loath to give up power and became
John Conroy Brough, Otorohanga
Opinion
en-nz
2021-12-04T08:00:00.0000000Z
2021-12-04T08:00:00.0000000Z
https://fairfaxmedia.pressreader.com/article/282140704662946
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