Reserve Bank of New Zealand monetary policy decision 13 April 2022.
RBNZ:
- says will remain focused on ensuring that current high consumer price inflation does not become embedded into longer-term inflation expectations.
- monetary tightening brought forward
- remained comfortable with the outlook for the OCR as outlined in their February MPS
- moving the OCR to a more neutral stance sooner will reduce the risks of rising inflation expectations.
- larger move now also provides more policy flexibility ahead in light of the highly uncertain global economic environment
From the minutes to the meeting, these are released at the same time as the decision:
- committee noted that the OCR is stimulatory at its current level
- members agreed that this ‘stitch in time’ approach is consistent with near-term financial market pricing
- members noted that annual consumer price inflation is expected to peak around 7 percent in the first half of 2022
- committee agreed that their policy ‘path of least regret’ is to increase the OCR by more now, rather than later
- members noted that inflation is above target and employment is above its maximum sustainable level
- the committee confirmed that further increases in the OCR are needed in order to meet their mandate
NZD has been marked higher on the announcement:
