The Reserve Bank of New Zealand left rates unchanged at its meeting yesterday but signalled it was likely to cut them again. “Some further reduction in the OCR (Overnight Cash Rate) seems likely,” said Governor Graeme Wheeler. “This will continue to depend on the emerging flow of economic data. It is appropriate at present to watch and wait.”
The Bank held rates steady at 2.75% after cutting rates for the three previous months in a decision that was widely expected. The Bank is concerned about a strengthening currency however, noting that the NZD is at a 5 month high against the AUD and heading towards parity again. Inflation is also below the 1.0% to 3.0% target range.