OCR unchanged at 8.25 percent - Te Pūtea Matua
Central bank: rbnz | Type: statement | Date: 2008-01-01

OCR unchanged at 8.25 percent
Published:
24 January 2008
The Official Cash Rate (OCR) will remain unchanged at 8.25 percent.
Reserve Bank Governor Alan Bollard said: "The outlook for the New
Zealand economy remains broadly consistent with the view outlined in the
December Monetary Policy
. While the housing market continues to cool, the labour market
remains tight, domestic income growth is still strong, especially from dairy,
and core inflationary pressures persist.
"Since the December
Monetary Policy Statement
there has been
ongoing turbulence in international financial markets and a deterioration in the
outlook for the United States and European economies. We will be watching these
developments closely, particularly their implications for the Asian and
Australian economies and for world commodity prices.
"Despite this, the New Zealand economy is projected to keep growing
reasonably well. Ongoing inflationary pressures are underpinned by an
expansionary fiscal policy, and rising food and energy prices, which will be
under further pressure with the Emissions Trading Scheme in a year's
"On balance, the outlook for interest rates is little changed from the
Monetary Policy Statement
, but the level of uncertainty has
increased. Although CPI inflation is expected to remain above 3 percent during
2008, we believe that the current level of the OCR remains consistent with
future inflation outcomes of 1 to 3 percent on average over the medium
Media Contact:
Mike Hannah
Communications
Ph 04 4713671,
mike.hannah@rbnz.govt.nz