The RBNZ has reinforced it is on hold with no hurry to lift interest rates in the near future. Its interest rate forecasts droppedby 50bp, a considerable downward revision and highlighting a shift in stance over the last 3 months. Aside from factoringin the continued drop in commodity prices and stubborn strength of the NZ dollar, the RBNZ is also looking closely atseveral transmission mechanisms that – for now – suggest inflation pressures may not be generated as readily as theywould have been in the past.
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