At its September monetary policy meeting on Wednesday, New Zealand’s central bank, the Reserve Bank of New Zealand (RBNZ), maintained its Official Cash Rate (OCR) at a historic low of 1.00%.
The Kiwi took a U-turn and jumped over 20-pips, breaching Tuesday’s high of 0.6332 on the status-quo.
Minutes of the meetings
Committee agreed new information did not warrant significant change to policy outlook.
Employment is around maximum sustainable level, inflation within target.
New Zealand rates can be expected to be low for longer.
Low interest rates, govt spending to support demand in coming years.
Business confidence remains low in New Zealand, partly reflecting policy uncertainty and low profitability in some sectors.
Reduction in the OCR this year has eased the New Zealand dollar exchange rate.
Keeping the OCR at low levels is needed to ensure inflation increases to the mid-point of the target range, and employment remains around its maximum sustainable level.
There remains scope for more fiscal and monetary stimulus, if necessary, to support the economy and maintain our inflation and employment objectives.
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.
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