A 2% cut in the Reserve Bank's official cash rate was justified, given aggressive cuts from other central banks, New Zealand Manufacturers and Exporters Association chief executive John Walley said.
"Big interest rate cuts around the world mean that New Zealand still has one of the highest interest rates in the world and this must change if we are to have a hope of addressing our debt mountain."
The Reserve Bank is expected to cut aggressively on Thursday, with some economists predicting cuts of 1.5%.
However, the consensus was for a 1% cut to take the OCR to 5.5% before Christmas and provide some welcome relief for home owners with floating-rate mortgages or those about to fix a term mortgage.
Investors on fixed incomes face lower bank deposit interest rates.
Mr Walley said the Bank of England had dropped its rate by 1.5% to 3% and the Reserve Bank of Australia (RBA) had cut its rates to 5%.
Both banks were predicted to cut again tomorrow.
Lower interest rates had failed to lift demand for credit in Australia, opening the way for another hefty reduction in the cash rate by RBA, AAP reported.
The Australian central bank's monthly credit report, released on Friday, showed overall credit rose just 0.6% in October, slower than the 0.8% growth seen in September.
The annual rate of credit growth in October slipped to 9.7% from 10% in the previous month.
The data takes into account the 1.25% of rate cuts made by the RBA in September and October.
It cut the official cash rate by a further 0.75% to 5.25% last month.
Notably, personal credit - not including housing - sank 1% in October to be minus 0.1% over the year.
Growth in housing credit eased slightly, while business credit was relatively steady.
Economists widely expect the RBA to cut the official cash rate by a another 0.75% tomorrow.
But given the present economic climate, some say they would not be surprised if the bank opted for a 1% cut.
In New Zealand, residential construction sank further into the mire in October, with the number of new dwelling units authorised the lowest in 16 years as the global credit crunch hit household incomes.
The 1173 building consents issued in October for new homes, including apartments, was the lowest monthly total since January 1992, Statistics New Zealand (SNZ) said on Friday.
October's total was down 22% on a year earlier when apartments were included, and down 24% with apartments excluded.
Also, the seasonally adjusted number of authorised new housing units, excluding apartments, fell 7.1% compared with September.
When apartments were included, the total was down 22% because of the low number of consents issued last month.
The 50 apartment units authorised in October was the lowest monthly total since April 2000, apart from March 2008, when there were also 50 apartment units authorised, SNZ said.
Building consents issued in October were valued at $439 million, down 32% on October 2007.
For the year ended October, the value of consents issued for residential buildings fell $1.19 billion, or 15%, to $6.58 billion, compared with the October 2007 year.
The value for non-residential buildings dropped 14% compared with a year earlier, to $348 million.
For the year ended October, the value of non-residential building consents was up 7.2% from the previous year, to $4.48 billion.
The value of consents issued for all buildings was $788 million in October, down 25% on October 2007.
For the October year, the value of consents issued for all buildings was $11.06 billion, down 7.5% from the previous year.
Any interest rate cut by the New Zealand Reserve Bank will be welcomed by home owners, who saw their median weekly mortgage payment rise by $72 in the June year from the previous 12 months.
The 27.8% rise in median mortgages took median weekly payments to $328 from $256, SNZ said.
In the latest year, 28% (135,700) of New Zealand households with a mortgage paid more than $500 a week in mortgage payments, up from 18% (86,300) in 2006-07.
Just over 37,200 households, or 8%, were paying more than $800 a week in the latest year, SNZ said.
The median weekly mortgage payment in Auckland was $472, Wellington $350, Canterbury $307, the rest of the North Island $262, and the rest of the South Island $242.
The figures were among data in SNZ's Household Economic Survey (Income), a shortened version of the full triennial Household Economic Survey.
It is the first time the shortened survey has been run.
It showed the median annual household regular income rose 3.9% in the latest year to $57,947.
The average annual household income from regular sources rose 8.8% to $73,952.
