The Reserve Bank has left its official cash rate unchanged at
2.5 per cent, which was in line with market expectations, but
said it was watching house price inflation closely.
Reserve Bank governor Graeme Wheeler kept the official cash
rate at 2.5 percent in his debut review this morning, and is
keeping close tabs on the level of inflation after it dropped
below the bank's target band in the September quarter.
New Reserve Bank governor Graeme Wheeler would face a tough
call on his first outing on the official cash rate tomorrow,
NZIER head of public-good research Kirdan Lees said
yesterday.
New Reserve Bank governor Graeme Wheeler will issue his first
official cash rate statement on Thursday with the big unknown
being how his attitude differs from that of his predecessor,
Alan Bollard.
Annual inflation, measured by the consumer price index (CPI),
has hit a surprise 13-year low of 0.8% and raised questions
about the Reserve Bank cutting the already record-low
official cash rate.
The Reserve Bank held the official cash rate at 2.5% as
expected but the main focus for markets will be what action
the United States Federal Reserve took early this morning
(about 3am) to help stimulate the US economy.
Outgoing Reserve Bank Governor Allan Bollard is expected to
keep the official cash rate (OCR) at its present record low
of 2.5%, when delivering his final review on Thursday.
