RBNZ’s Orr: Projection shows upward bias to rates but it is not a done deal
|Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr is addressing the post-monetary policy meeting press conference on Wednesday. The RBNZ held the interest rate steady at 5.50% for the fifth meeting in a row in November.
Key quotes
Meeting with new PM was highly constructive.
We've been adament on holding rates through next year.
Projection shows upward bias to rates but it is not a done deal.
Risk to inflation is still more to upside.
We did discuss raising rates at this meeting.
Had a robust discussion about rates.
Nervous that inflation has been outside the band for so long.
Concerned that longer-term inflation expectations are creeping up.
Global rates do matter to the US, very tuned into that outlook.
Will make decision on debt to income restrictions early next year.
Seeing credit growth slowing rapdily, our message on rates is being heeded.
We are saying rates need to be this high for some time to come, banks should listen.
We are not bound by policy meeting dates, can act on shocks if needed.
Comfortable on waiting until the February meeting right now.
Domestic inflation is causing the challenge, big part of that is dwelling costs.
Market reaction
NZD/USD is consolidating its upsurge at around 0.6190 on Orr’s comments. The pair is currently trading at 0.6193, up 0.96% on the day.
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