Central Banks

The Reserve Bank of New Zealand have left the official cash rate (OCR) at 1.75%, an as expected no change decision for monetary policy.

  • There is no official Monetary Policy Statement nor media conference following for this decision. The 8th of November RBNZ meeting will be followed by a Monetary Policy Statement and press conference 

There is a brief press release, highlights (bolding mine):  

  • We expect to keep the OCR unchanged into 2020
  • direction of our next OCR move could be up or down.
  • Employment is around its sustainable level
  • consumer price inflation remains below the 2 percent mid-point of our target, necessitating continued supportive monetary policy
  • Our outlook for the OCR assumes the pace of growth will pick up over the coming year, assisting inflation to return to the target mid-point.
  • Our projection for the New Zealand economy, as detailed in the August Monetary Policy Statement, is little changed. 
  • Robust global economic growth and a lower New Zealand dollar exchange rate is expected to support demand for our exports.
  • Trade tensions remain … increasing the risk that ongoing increases in trade barriers could undermine global growth
  • Domestically, ongoing spending and investment, by both households and government, is expected to support growth.
  • There are welcome early signs of core inflation rising towards the mid-point of the target.
  • Higher fuel prices are likely to boost inflation in the near term, but we will look through this volatility as appropriate. Consumer price inflation is expected to gradually rise to our 2 percent annual target as capacity pressures bite.We will keep the OCR at an expansionary level for a considerable period to contribute to maximising sustainable employment, and maintaining low and stable inflation.

The NZD response is subdued – some whip in a small range 

Adrian Orr, RBNZ Governor 


For background to this, previews (plenty of them) linked from here:

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