New Zealand Dollar: RBNZ hikes but warns of more – BNY
BNY’s Geoff Yu reports that the Reserve Bank of New Zealand (RBNZ) raised its Official Cash Rate (OCR) by 25bp to 2.50% to steer inflation back to 2%. The committee still sees further removal of stimulus as likely, though data will guide decisions. The partial reopening of the Strait of Hormuz has eased Oil-related inflation pressures, but the earlier shock hurt New Zealand’s Q2 growth, with recovery expected in Q3 as confidence improves.
Policy tightening keeps inflation in focus
"The RBNZ has hiked its OCR by 25bp to 2.50%, seeking to return inflation to the 2% target."
"The committee continues to expect that further removal of monetary stimulus may be required, although future policy decisions will be guided by incoming data, inflation dynamics and economic activity."
"It said the recent partial reopening of the Strait of Hormuz had lowered global oil and petrochemical prices, easing near-term inflation pressures, though the shock will continue to affect the outlook. "
"It also noted that New Zealand’s recovery had been underway but lost momentum in the June quarter as the oil shock weighed on activity; growth is expected to recover in the September quarter as confidence improves."
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)