RBNZ’s Orr: Committee was confident in the level of restrictiveness of interest rates
“The committee was confident in the level of restrictiveness of interest rates at the present point,” said Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr to New Zealand government Finance and Expenditure Committee on late Wednesday.
Key quotes
They (interest rates) are well above what we would consider neutral, are constraining spending and investment.
There were indicators consumer spending and aggregate demand as a whole were easing and in some places were falling in real terms.
The committee is confident monetary policy is restrictive and doing its job.
The central bank never rules out the need to change that view.
There were risks that the central bank would need to raise rates due to sticky inflation expectations and continued government spending.
There were also downside risks including weaker-than-expected gross domestic product and a larger-than-expected impact as households as they roll over on to higher mortgage rates.
NZD/USD stays depressed
NZD/USD holds lower grounds near early March levels, after falling the most since early February the previous day, defensive near 0.6100 by the press time.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
