At its second scheduled monetary policy meeting for this year, the Reserve Bank of New Zealand (RBNZ) decided to leave the Official Cash Rate (OCR) unchanged at a record low of 0.25% in May.
New Zealand’s central bank expands the quantitative easing (QE) programme size, matchingt expectations of an increase to around NZD60 billion.
In a surprise move, instead of meeting on March 25th, the Reserve Bank of New Zealand (RBNZ) set its official cash rate at 0.25% on March 15th in an emergency meeting. At that meeting, Governor Adrian Orr said that the board is not contemplating negative interest rates.
What followed after a week was the QE announcement, with NZD33bn of NZGBs of different maturities across the yield curve over the next 12 months.
About RBNZ Interest Rate Decision
RBNZ Interest Rate Decision is announced by the Reserve Bank of New Zealand. If the RBNZ is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the NZD.
NZD/USD spiked to near 0.6100 in a knee-jerk reaction to the RBNZ QE expansion announcement but took a U-turn from there to now drop over 0.50% to 0.6040. The kiwi central bank kept the rates steady at 0.25%, as widely expected. The central bank left doors open for further rates cuts and negative rates as an option too.
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