Home Business & Finance RBNZ Leaves the Official Cash Rate Unchanged at 1.75 Percent

RBNZ Leaves the Official Cash Rate Unchanged at 1.75 Percent

RBNZ Leaves the Official Cash Rate Unchanged at 1.75 Percent

The Reserve Bank of New Zealand recently released its quarterly Monetary Policy Statement as it left the Official Cash Rate unchanged at 1.75 percent. In addition to this, the RBNZ maintained its forecast for next quarter due to a number of uncertainties in place.

The statement notes, “Global economic growth continues to improve. While global inflation remains subdued, there are some signs of emerging pressures.”

“The exchange rate has firmed since the November Statement, due in large part to a weak US dollar. We assume the trade weighted exchange rate will ease over the projection period.”

“GDP growth eased over the second half of 2017 but is expected to strengthen, driven by accommodative monetary policy, a high terms of trade, government spending and population growth.”

“Compared to the November Statement, the growth profile is weaker in the near term but stronger in the medium term.”

“House price inflation has increased somewhat over the past few months but housing credit growth continues to moderate.”

“Overall, CPI inflation is forecast to trend upwards towards the midpoint of the target range. Longer-term inflation expectations are well anchored at 2 percent.”

“Monetary policy will remain accommodative for a considerable period. Numerous uncertainties remain and policy may need to adjust accordingly.”

Related Articles