The Reserve Bank of New Zealand was expected to keep rates unchanged, they have
Official Cash Rate (OCR) stays at 1.75%
- Major challenges remain with on-going surplus capacity and extensive political uncertainty
- Core inflation and long-term bond yields remain low
- Monetary policy is expected to remain stimulatory in the advanced economies, but less so going forward
- The trade-weighted exchange rate has increased by around 3 percent since May, partly in response to higher export prices. A lower New Zealand dollar would help rebalance the growth outlook towards the tradables sector.
- Growth outlook remains positive, supported by accommodative monetary policy, strong population growth, and high terms of trade ... Recent changes announced in Budget 2017 should support the outlook for growth
- The increase in headline inflation in the March quarter ... effects are temporary ... will bring future headline inflation to the midpoint of the target band over the medium term.
- Monetary policy will remain accommodative for a considerable period.
Today's decision text, in full
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There is no Monetary Policy Statement (MPS) for release with today's decision.
There is no press conference from Governor Wheeler.
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NZD has responded with a move higher. While there is no Monetary Policy Statement to accompany today's decision the short explanatory statement is pretty upbeat (for a central bank) and the comment on the NZD is a very weak attempt at jawboning (if that is what it is)
Updates:
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The next policy decision is due on August 10, and that will include a Monetary Policy Statement & media conference
