HiFX Data Update - RBNZ Official Cash Rate Decision

HiFX Data Update - RBNZ Official Cash Rate Decision

The RBNZ have maintained the Official Cash Rate (OCR) at 1.75%. This was widely expected.

The key points in the RBNZ statement are:

• Keeps cash rate unchanged at 1.75%

• Expects no change in rates for "considerable period"

• Numerous uncertainties remain; may adjust policy accordingly

• Lower NZD would help rebalance growth outlook

• Recent budget will support outlook for growth

• House price inflation has moderated

• Q1 inflation rise likely temporary

• Wage inflation remains moderate

• Longer-term inflation expectations well anchored

• Expects future headline inflation to reach the midpoint of the target band over the medium term

• Inflation rise mainly due to temporary factors, may lead to some variability in headline inflation

• House price inflation has moderated further, moderation projected to continue

• There is risk of resurgence in house price inflation given the on-going imbalance between supply and demand

The NZD is higher in immediate response.

The next OCR decision and full Monetary Policy Statement will be held on 10th August 2017.

Below is link to the full RBNZ press statement:

http://www.rbnz.govt.nz/news/2017/06/official-cash-rate-unchanged-at-1-75-percent

Current indicative levels are:

NZD-USD 0.7235 / 0.7260
NZD-AUD 0.9580 / 0.9605
NZD-EUR 0.6480 / 0.6505
NZD-GBP 0.5705 / 0.5730
NZD-JPY 80.55 / 80.80

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