AUROA: The New Zealand dollar weakened against the other major currencies in the Asian session on Thursday after the Reserve Bank of New Zealand’s Monetary Policy Board decided to hold its Official Cash Rate steady.
The board elected to hold its Official Cash Rate steady at 3.50 percent – in line with expectations.
It was the sixth straight month with no change for the RBNZ, which had hiked the OCR by 25 basis points in each of previous four meetings prior to September.
The board also pointed to the easing NZ dollar, adding that further depreciation is to be expected.
The bank also cited several factors for taking its time in taking any further actions, including weak global inflation, declines in international oil prices and the high exchange rate.
“The timing of future adjustments in the OCR will depend on how inflationary pressures evolve in both the non-traded and traded sectors. It would be appropriate to lower the OCR if demand weakens, and wage and price-setting outcomes settle at levels lower than is consistent with the inflation target,” the bank said.
Meanwhile, data from the Statistics New Zealand showed that the total number of building permits issued in New Zealand advanced a seasonally adjusted 11.0 percent on month in March, standing at 2,271, a nine-year high. That topped forecasts for an increase of 2.0 percent following the 6.3 percent contraction in February.
