New Zealand Interest Rate  1985-2016 | Data | Chart | Calendar | Forecast

The Reserve Bank of New Zealand lowered its official cash rate by 25bps to 2 percent in August, saying the strong New Zealand dollar is adding further pressure to the export and import-competing sectors and, together with low global inflation, is causing negative inflation in the tradables sector. Policymakers also said further policy easing will be required to bring inflation back to target. Interest Rate in New Zealand averaged 7.75 percent from 1985 until 2016, reaching an all time high of 67.32 percent in March of 1985 and a record low of 2 percent in August of 2016. Interest Rate in New Zealand is reported by the Reserve Bank of New Zealand.

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Actual Previous Highest Lowest Dates Unit Frequency
2.00 2.25 67.32 2.00 1985 - 2016 percent Daily
In New Zealand, interest rates decisions are taken by the Reserve Bank of New Zealand. The official interest rate is the Official Cash Rate (OCR). The OCR was introduced in March 1999 and is reviewed eight times a year by the Bank. The OCR influences the price of borrowing money in New Zealand and provides the Reserve Bank with a means of influencing the level of economic activity and inflation. This page provides - New Zealand Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news. New Zealand Interest Rate - actual data, historical chart and calendar of releases - was last updated on August of 2016.


Calendar GMT Reference Actual Previous Consensus Forecast (i)
2016-04-27 09:00 PM Interest Rate Decision 2.25% 2.25% 2.25% 2.25%
2016-06-08 09:00 PM Interest Rate Decision 2.25% 2.25% 2.25% 2.25%
2016-08-10 09:00 PM Interest Rate Decision 2% 2.25% 2% 2.0%
2016-09-21 09:00 PM Interest Rate Decision 2% 2%
2016-10-09 08:00 PM Interest Rate Decision 1.75%

New Zealand Cuts Official Cash Rate to 2%


The Reserve Bank of New Zealand lowered its official cash rate by 25bps to 2 percent in August, saying the strong New Zealand dollar is adding further pressure to the export and import-competing sectors and, together with low global inflation, is causing negative inflation in the tradables sector. Policymakers also said further policy easing will be required to bring inflation back to target.

Statement by Reserve Bank Governor Graeme Wheeler:

The Reserve Bank today reduced the Official Cash Rate (OCR) by 25 basis points to 2.0 percent.

Global growth is below trend despite being supported by unprecedented levels of monetary stimulus. Significant surplus capacity remains across many economies and, along with low commodity prices, is suppressing global inflation. Some central banks have eased policy further since the June Monetary Policy Statement, and long-term interest rates are at record lows. The prospects for global growth and commodity prices remain uncertain. Political risks are also heightened.

Weak global conditions and low interest rates relative to New Zealand are placing upward pressure on the New Zealand dollar exchange rate. The trade-weighted exchange rate is significantly higher than assumed in the June Statement. The high exchange rate is adding further pressure to the export and import-competing sectors and, together with low global inflation, is causing negative inflation in the tradables sector. This makes it difficult for the Bank to meet its inflation objective. A decline in the exchange rate is needed.

Domestic growth is expected to remain supported by strong inward migration, construction activity, tourism, and accommodative monetary policy. However, low dairy prices are depressing incomes in the dairy sector and reducing farm spending and investment. High net immigration is supporting strong growth in labour supply and limiting wage pressure.

House price inflation remains excessive and has become more broad-based across the regions, adding to concerns about financial stability. The Bank is consulting on stronger macro-prudential measures that should help to mitigate financial system risks arising from the rapid escalation in house prices.

Headline inflation is being held below the target band by continuing negative tradables inflation. Annual CPI inflation is expected to weaken in the September quarter, reflecting lower fuel prices and cuts in ACC levies. Annual inflation is expected to rise from the December quarter, reflecting the policy stimulus to date, the strength of the domestic economy, reduced drag from tradables inflation, and rising non-tradables inflation. Although long-term inflation expectations are well-anchored at 2 percent, the sustained weakness in headline inflation risks further declines in inflation expectations.

Monetary policy will continue to be accommodative. Our current projections and assumptions indicate that further policy easing will be required to ensure that future inflation settles near the middle of the target range. We will continue to watch closely the emerging economic data.

Reserve Bank New Zealand | Joana Ferreira | joana.ferreira@tradingeconomics.com
8/10/2016 10:19:02 PM

New Zealand Money Last Previous Highest Lowest Unit
Interest Rate 2.00 2.25 67.32 2.00 percent [+]
Interbank Rate 2.75 2.77 24.25 2.62 percent [+]
Money Supply M0 5632.00 5598.00 6113.00 1081.00 NZD Million [+]
Money Supply M1 46614.00 45925.00 47192.00 1585.70 NZD Million [+]
Money Supply M2 152508.00 152569.00 155766.00 19760.00 NZD Million [+]
Money Supply M3 313758.00 313589.00 315150.00 6726.00 NZD Million [+]
Foreign Exchange Reserves 25161.00 28557.00 28557.00 1029.50 NZD Million [+]
Banks Balance Sheet 504602.00 504725.00 505687.00 236047.00 NZD Million [+]
Deposit Interest Rate 3.80 4.01 16.32 3.80 percent [+]
Central Bank Balance Sheet 23438.00 25983.00 33766.00 7116.00 NZD Million [+]
Loans To Private Sector 92113.00 91912.00 92113.00 31241.00 NZD Million [+]




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