Economists predict up to three more hikes this year
The Reserve Bank this morning increased the rate by another 25 basis points, to 3%.
Governor Graeme Wheeler said the rate needed to be at a level where interest rates would not add to demand, fuelling inflation. He reiterated that rates will rise but indicated several factors would determine how quickly that happened.
"The speed and extent to which the OCR will be raised will depend on economic data and our continuing assessment of emerging inflationary pressures, including the extent to which the high exchange rate leads to lower inflationary pressure," he said.
BNZ chief economist Tony Alexander said there was nothing surprising about the fact that the Reserve Bank would want to judge things as it went along because it was not yet clear how the economy and consumers would react to the changing rates.
Click the button below to subscribe and will have free unlimited access for a limited time to full article and all other articles on the site.
You will also be able to comment on articles on Good Returns.
