Reserve Bank of New Zealand Cash Rate Remains 1.75%

March 22, 2018

Seven consecutive cuts in the Official Cash Rate between June 2015 and November 2016 halved such to 1.75%, and a statement following the latest policy review opines that the stance is likely to remain accommodative “for a considerable period” longer. Partly because of weather, economic growth last quarter was slower than expected, but central bank officials anticipate that activity will strengthen because of a high terms of trade, population expansion and fiscal stimulus. The labor market should tighten, so that despite a likely drop in CPI inflation near term, a subsequent uptrend toward the target midpoint is likely to ensue. Like many central bank policymakers, there are many uncertainties to monitor.

Copyright 2018, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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