Xinhua
24 May 2023, 09:35 GMT+10
WELLINGTON, May 24 (Xinhua) -- The Monetary Policy Committee of the Reserve Bank of New Zealand (RBNZ) voted to raise the Official Cash Rate (OCR) from 5.25 percent to 5.5 percent on Wednesday, in an effort to further control inflation.
The committee agreed the level of interest rates is constraining spending and inflation pressure.
The OCR will need to remain at a restrictive level for the foreseeable future, to ensure that consumer price inflation returns to the 1-3 percent annual target range, while supporting maximum sustainable employment, said an RBNZ statement.
International supply chain constraints have also eased following a period of disruption, and shipping costs have declined. The weaker global growth has led to lower export prices for New Zealand's goods, the statement said.
In New Zealand, inflation is expected to continue to decline from its peak. However, core inflation pressures will remain until capacity constraints ease further. While employment is above its maximum sustainable level, there are now signs of labor shortages easing and vacancies declining, it said.
Consumer spending growth has eased and residential construction activity has declined, while house prices have returned to more sustainable levels, it said, adding that more generally, businesses are reporting slower demand for their goods and services, and weak investment intentions.
"Businesses report that a lack of demand, rather than labor shortages, is now the main constraint on activity," RBNZ said.
While immigration has assisted in easing labor shortages, its net impact on overall spending is uncertain. The recent recovery in tourism spending to around three-quarters of its pre-COVID-19 trend level also supports demand, it said.
Get a daily dose of Central Asia Times news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Central Asia Times.
More InformationWASHINGTON, DC - U.S. President Donald Trump on Tuesday claimed Elon Musk's success has been built on government subsidies. Without...
EVERGLADES, Florida: Over the weekend, a diverse coalition of environmental activists, Native American leaders, and residents gathered...
BEIJING, China: China's national soccer team may struggle to stir excitement, but its humanoid robots are drawing cheers — and not...
]LONDON, U.K.: A World Health Organization (WHO) expert group investigating the origins of the COVID-19 pandemic released its final...
DOVER, Delaware: California Governor Gavin Newsom has taken legal aim at Fox News, accusing the network of deliberately distorting...
FRANKFURT, Germany: Germany has become the latest country to challenge Chinese AI firm DeepSeek over its data practices, as pressure...
BEIJING, China: China's national soccer team may struggle to stir excitement, but its humanoid robots are drawing cheers — and not...
]LONDON, U.K.: A World Health Organization (WHO) expert group investigating the origins of the COVID-19 pandemic released its final...
FRANKFURT, Germany: Germany has become the latest country to challenge Chinese AI firm DeepSeek over its data practices, as pressure...
BANGKOK, Thailand: This week, Thailand implemented land border restrictions, including a ban on tourists traveling to Cambodia, as...
Washington, DC [US], July 2 (ANI): The Foreign ministers of the Quad nations met in Washington, DC, on July 1 to reaffirm their steadfast...
Aluminum, copper and nickel shipments have surged this year, according to trade data Beijing has increased purchases of Russian metals...