The Reserve Bank of New Zealand today left interest rates at 5.5 per cent for a second meeting. The central bank last raised the cash rate in May from 5.25 per cent.The level of interest rates are constraining spending and inflation pressure as anticipated and required.
In New Zealand, inflation is expected to continue to decline from its peak, and with it measures of inflation expectations. Core inflation is expected to decline as capacity constraints ease. While employment is above its maximum sustainable level, there are signs of labour market pressures dissipating and vacancies declining.
The return of net inward migration continues broadly as anticipated, and is assisting to ease labour shortages. The net impact of immigration on overall capacity pressures remains uncertain. The ongoing recovery in tourism spending is supporting demand.
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Source: FinancialReview - 🏆 2. / 90 Read more »