The Reserve Bank of New Zealand’s (RBNZ) Monetary Policy Committee (MPC) decided to keep the official cash rate unchanged at 3.35% at its meeting this morning, Wednesday, June 9, as expected, following a series of cuts that have lasted for six consecutive meetings.
The statement issued by the bank indicated that annual consumer price inflation is approaching the top of the MPC’s target range of 1% to 3% by the middle of this year, and that headline inflation is expected to remain within this range and return to the 2% target by early next year, 2026.
Rising exports and lower interest rates are expected to support the New Zealand economic recovery. However, increased global policy uncertainty could dampen global growth and thus slow the pace of the New Zealand economic recovery, easing inflationary pressures.
The bank left the door open to further interest rate cuts, adding that if inflationary pressures continue to subside over the medium term, as expected, the committee will cut interest rates further.