New Zealand’s central bank raised interest rates by another 25 basis points on Wednesday, bringing the benchmark rate to the highest level in more than a decade.
The Reserve Bank of New Zealand (RBNZ) took its interest rate to 5.5%, the highest level in 14 years and reiterated that inflation remains too high. The raise was in line with expectations from 21 of 25 economists in a Reuters poll.
The central bank stated that the official cash rate will need to remain at a restrictive level for the foreseeable future, to ensure that consumer price inflation returns to the 1% to 3% target range.
RBNZ is still forecasting a technical recession and is projecting negative growth in the second and third quarter of 2023.
