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10 Dec 2014
RBNZ maintains OCR at 3.5% and expects more gradual rise in interest rate
FXStreet (San Francisco) - The Reserve Bank of New Zealand maintained its interest rate unchanged at 3.50% according to the latest press release published by the bank.
The bank considers that the NZD level 'remains unjustified and unsustainable,' and the bank expects 'a further significant depreciation, which should be reinforced as monetary policy in the US begins to normalise.'
The statement issued by Reserve Bank Governor Graeme Wheeler says that some further increase in the OCR is expected to be required at a later stage.
New Zealand’s economy is expected to grow at an annual pace of 3.7 percent over 2014.
Key quotes:
Global financial conditions remain very accommodative and are reflected in low interest rates, narrow risk spreads, and low volatility across a range of asset markets.
New Zealand’s economic growth continues to be supported by increasing construction activity and ongoing strength in consumption and business investment.
The exchange rate has yet to adjust materially to the lower commodity prices. Its current level remains unjustified and unsustainable. We expect a further significant depreciation, which should be reinforced as monetary policy in the US begins to normalise.
we expect some further policy tightening will be necessary to keep future average inflation near the 2 percent target mid-point and ensure that the economic expansion can be sustained.
The bank considers that the NZD level 'remains unjustified and unsustainable,' and the bank expects 'a further significant depreciation, which should be reinforced as monetary policy in the US begins to normalise.'
The statement issued by Reserve Bank Governor Graeme Wheeler says that some further increase in the OCR is expected to be required at a later stage.
New Zealand’s economy is expected to grow at an annual pace of 3.7 percent over 2014.
Key quotes:
Global financial conditions remain very accommodative and are reflected in low interest rates, narrow risk spreads, and low volatility across a range of asset markets.
New Zealand’s economic growth continues to be supported by increasing construction activity and ongoing strength in consumption and business investment.
The exchange rate has yet to adjust materially to the lower commodity prices. Its current level remains unjustified and unsustainable. We expect a further significant depreciation, which should be reinforced as monetary policy in the US begins to normalise.
we expect some further policy tightening will be necessary to keep future average inflation near the 2 percent target mid-point and ensure that the economic expansion can be sustained.