RBNZ Review: Unchanged as expected

RBNZ Kept Its OCR Forecast

There is no change to major forecast. Some key takeaways:

• High Rates are here to Stay: "The Committee agreed that the OCR needs to stay at a restrictive level to ensure that annual consumer price inflation returns to the 1 to 3% target range and to support maximum sustainable employment." 
• Demand Growth is Easing: Growth outlook is subdued despite stronger than expected Q2 GDP. As restrictive monetary policy stays, consumption is forecasted to be lower.
• Inflation Moderating but will take a long time to return to target: Headline inflation is expected to continue to decline from its peak and so as inflation expectations fro global economic growth will be below trend. Yet, the current inflation remains very high and would require a substantial period of modest economic activity to see inflation return to target range.