OCR unchanged at 2.5 percent - Te Pūtea Matua
Central bank: rbnz | Type: statement | Date: 2012-01-01

OCR unchanged at 2.5 percent
Published:
26 January 2012
The Reserve Bank today left the Official Cash Rate
(OCR) unchanged at 2.5 percent.
Reserve Bank Governor Alan Bollard said: "Since the time of the
, financial market sentiment has improved slightly,
with increased liquidity in European financial markets. However, the global
economy remains fragile and risks to the outlook remain.
"World prices for New Zealand's export commodities have remained
elevated but the recent appreciation of the New Zealand dollar is reducing
exporters' returns. The European debt crisis has also increased the cost
of international funding, which will likely pressure funding costs for New
Zealand banks over the coming year.
"In the domestic economy we continue to see modest growth. Over recent
months there have been signs of a limited recovery in household spending and the
housing market. Further ahead, repairs and reconstruction in Canterbury will
also provide a significant boost for an extended period, though there may be
further delays resulting from the aftershocks.
"Reassuringly, inflation pressures have remained well contained.
Inflation has declined and now sits below 2 percent.
"Given ongoing uncertainty around global conditions and the moderate
pace of domestic demand, it remains prudent to keep the OCR on hold at 2.5
Media contact:
Mike Hannah
Head of Communications
Ph 04 4713671, 021
mike.hannah@rbnz.govt.nz