The Reserve Bank of New Zealand has left rates on hold at 0.25%, as widely expected and there has been little reaction in the market so far.
Key notes
Says large scale asset purchase programme maintained at NZ$100 bln.
Says funding for lending programme unchanged.
Says prepared to lower OCR if required.
Says monetary stimulus continued.
Says to maintain current monetary settings until it confident that inflation will and employment targets achieved.
Says economic activity in New Zealand slowed over the summer months.
Says planned trans-tasman travel arrangements should support incomes and employment.
Says medium-term inflation and employment would likely remain below its remit targets in the absence of prolonged monetary stimulus.
Says extent of the dampening effect of the government’s new housing policies on house price growth will take time to be observed.
Says outlook remains highly uncertain.
Reduced government bond issuance was placing less upward pressure on New Zealand government bond yields and providing less scope for LSAP purchases.
NZD/USD implications
Meanwhile, the kiwi had been testing hourly resistance.
Description of the RBNZ Interest Rate Decision
RBNZ Interest Rate Decision is announced by the Reserve Bank of New Zealand.
If the RBNZ is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the NZD.
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