Reserve Bank of New Zealand

New Zealand’s Central Bank Leaves Cash Rate at 2.5% and Delivers Dovish Statement

January 27, 2016

The statement from the Reserve Bank of New Zealand arrived an hour after the FOMC statement and reveals more about the market’s angst over Fed tightening than about New Zealand.  Both central banks left key interest rates unchanged in January, which wasn’t a great surprise since each had changed rate levels at the previous policy […] More

Reserve Bank of New Zealand Official Cash Rate Is Cut

December 9, 2015

The OCR as expected was cut by 25 basis points to 2.5%, thus returning for a third time to the low level first observed from March 2009 until October 2010 and subsequently from March 2011 to March 2014.  Following four 25 basis point hikes in 2014, today’s action represents the fourth 25-basis point cut this […] More

Reserve Bank of New Zealand in Easing State of Mind

July 23, 2015

Monetary officials at the RBNZ are pushing for easier monetary conditions through a combination of lower interest rates and additional New Zealand dollar depreciation.  A statement from Governor Wheeler after the second straight policy meeting to cut the Official Cash Rate (OCR) proclaimed that the economic outlook now looks somewhat softer than imagined at the […] More

Weaker Dollar and Pound

July 23, 2015

The dollar edged 0.1% firmer against sterling but has lost 1.4% against the kiwi, 0.7% relative to the euro, 0.6% vis-a-vis the Swiss franc, 0.4% versus the loonie and Aussie dollar and 0.2% against the yen.  The yuan is steady. Share prices rose 2.3% in China 0.6% in Hong Kong and 0.4% in Japan but […] More

Reserve Bank of New Zealand

June 11, 2015

In an unexpected move, New Zealand’s Official Cash Rate was cut for the first time since March 2011.  The drop to 3.25% from 3.5% left the OCR still 75 basis points above the 2.50% low over the two years from March 2011 through March 2013, and an accompanying statement failed to rule out additional monetary […] More

Reserve Bank of New Zealand Keeps Official Cash Rate at 3.5%

April 29, 2015

The OCR has been at 3.5% since a 25-basis point hike last July, but the policy bias is toward easing as attested by this passage from the latest policy statement: The Bank expects to keep monetary policy stimulatory, and is not currently considering any increase in interest rates. We are watching closely the ongoing impact […] More

Weaker-than-Expected PMIs and a Market-Moving Comment from John McDermott

April 23, 2015

The kiwi slumped 1.4% after Reserve Bank of New Zealand Assistant Governor McDermott said that policymakers are not currently contemplating a further rise in the official cash rate. Otherwise the U.S. currency fell overnight by 0.6% against the Swiss franc and 0.1% versus the euro but rose by 0.4% relative to the Australian dollar, 0.2% […] More

Reserve Bank of New Zealand Leaves Key 3.5% Interest Rate Unchanged

March 11, 2015

Monetary officials continue to encourage a shift in market expectations about its future policymaking.  As recently as two meetings ago in December, officials retained the view that excess capacity would be diminishing and that more rate hikes would be required.  The Official Cash Rate had been at 2.5% for three years following a 50-basis point […] More

Reserve Bank of New Zealand

January 28, 2015

The latest Board meeting with a decision to keep New Zealand’s official cash rate at 3.5%, the level since the fourth straight 25-basis point hike lf 2014.  The four increases, respectively in March, April, June and July, followed a three-year span with no change.  Today’s statement was more dovish than the previous one because of […] More

Reserve Bank of New Zealand Tightening Kept on Pause

December 11, 2014

Rate normalization began earlier this year with 25-basis point hikes of the New Zealand official cash rate in March, April, June and July.  Like their two earlier meetings, officials did not tighten further at the final scheduled policy review of 2014, preferring to keep the OCR at 3.5%.  A released statement observes benign inflation currently […] More