Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

OCR unchanged at 6.75 per cent

28 July 2005

OCR unchanged at 6.75 per cent

The Reserve Bank has left the Official Cash Rate (OCR) unchanged at 6.75 per cent.

Reserve Bank Governor Alan Bollard said: "The economy has recently shown signs of softening. GDP growth has continued to ease over recent quarters, particularly in sectors such as manufacturing that are exposed to the strong exchange rate.

Indicators of business activity have been pointing downwards for some months and it now appears that household consumption growth is also beginning to weaken. However, residential housing market indicators remain firm, representing an upside risk for the future path of household spending and inflation.

We view the overall easing in activity as broadly consistent with our June MPS economic outlook. "Inflation pressures nevertheless remain present. Several years of strong growth have led to productive resources becoming stretched and the resulting inflation pressures will take some time to unwind. Moreover, additional short-term inflation pressures have recently emerged as a result of surging oil prices and the waning impact of the strength in the exchange rate over recent years. These short-term inflation pressures, which could easily be exacerbated, are now expected to push CPI inflation temporarily above 3 per cent over the coming quarters.

"Looking further ahead, we expect that current policy settings will be sufficient to achieve our objective of 1-3 per cent inflation on average over the medium term. However, in the current environment, monetary policy must remain vigilant.

We remain vulnerable to upside inflation risks and monetary policy must continue to work at reducing the ongoing excess demand pressures. A firm policy stance is also necessary to prevent the expected short-term inflation pressures from becoming entrenched in inflation expectations.

A further tightening of policy could not be ruled out in the event of a resurgence in medium-term inflation pressures. Certainly there remains no prospect of a policy easing in the foreseeable future."

ENDS

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop 3.0: How You Can Help Scoop’s Evolution

We have big plans for 2018 as we look to expand our public interest journalism coverage, upgrade our publishing infrastructure and offer even more valuable business tools to commercial users of Scoop. More>>

Having A Cow? Dairy Product Prices Slide For Fourth Straight Auction

Dairy product prices fell at the Global Dairy Trade auction, retreating for the fourth straight auction amid signs of increased production... Whole milk powder fell 2.7 percent to US$2,778 a tonne. More>>

ALSO:

Statistics: Butter At Record $5.67/Block; High Vegetable Prices

Rising dairy prices have pushed food prices up 2.7 percent in the year to October 2017, Stats NZ said today. This followed a 3.0 percent increase in the year to September 2017. More>>

ALSO:

Science: New Research Finds Herbicides Cause Antibiotic Resistance

New University of Canterbury research confirms that the active ingredients of the commonly used herbicides, RoundUp, Kamba and 2,4-D (glyphosate, dicamba and 2,4-D, respectively), each alone cause antibiotic resistance at concentrations well below label application rates. More>>

ALSO:

CO2 And Water: Fonterra (And Dairy NZ)'s Environment Plans

Federated Farmers support Fonterra’s bold push to get to zero emissions of CO2 on the manufacturing side of the Co-operative, both in New Zealand and across its global network. More>>

ALSO:

Fisheries: Decision To Delay Monitoring ‘Fatally Flawed’

Conservation group representatives say a decision by the new Minister of Fisheries, Stuart Nash, to delay implementation of camera monitoring of fishing efforts in New Zealand is ‘fatally flawed’. More>>

ALSO:

 
 
 
 
 
 
 
 
  • Bill Bennett on Tech