Sharechat Logo

Official Cash Rate (OCR) unchanged at 2.5 percent.

Thursday 14th March 2013

Text too small?

The Reserve Bank today left the Official Cash Rate (OCR) unchanged at 2.5 percent.

The downside risks around global growth have receded in recent months, and financial market sentiment has improved.

Domestically, the economic recovery is uneven. While demand and output are expanding, the labour market remains weak. Economic growth and inflation are being shaped by a range of forces. The Canterbury rebuild is gaining momentum and residential investment and business and consumer confidence are increasing. House price inflation is increasing and the Bank does not want to see financial stability or inflation risks accentuated by housing demand getting too far ahead of supply.

The overvalued New Zealand dollar is undermining profitability in export and import competing industries, and worsening drought conditions are creating difficulty in much of the country. Ongoing fiscal consolidation will also act to slow overall demand.

We project the economy to grow at an annual rate of between 2 and 3 percent over the forecast period. Inflation is expected to rise gradually towards the 2 percent midpoint of the target range.

There are both upside and downside risks to this outlook. At this point we expect to keep the OCR unchanged through the end of the year.

 

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Govt eyes 2025 for farm-level emissions pricing, tests interim steps
Govt won't "die in a ditch" for 100% renewable target
NZ 2Q CPI +0.6% on quarter, +1.7% on year
NZ 2Q CPI +0.6% on quarter, +1.7% on year
16th July 2019 Morning Report
Suspect company faces liquidation after director dies
NZ dollar holds gains; focus on domestic inflation data
MARKET CLOSE: NZ shares slip as fears over slowing Chinese growth weigh; AMP slumps
NZ dollar rises after heartening Chinese data
Suspect company faces liquidation after director dies

IRG See IRG research reports