Economics
RBNZ Brings Forward Rate-Hike Forecast on Faster Inflation
- Central bank now sees inflation reaching 2% target next year
- Holds key rate at record low, projects first increase in 2019
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New Zealand’s central bank signaled that interest rates may need to rise slightly earlier than previously expected as it revised up inflation forecasts. The local dollar rose.
“Monetary policy will remain accommodative for a considerable period,” Reserve Bank Acting Governor Grant Spencer reiterated Thursday after keeping the official cash rate at 1.75 percent, a record low. Still, “the exchange rate has eased since the August statement and, if sustained, will increase tradables inflation and promote more balanced growth.”