RBNZ’s Wheeler:

  • Says inflation targeting remains appropriate
  • Inflation targeting has delivered stable prices
  • Real effective exchange rate remains unjustified and unsustainable
  • RBNZ is a flexible inflation targetter
  • Loan limits (he is referring to the macroprudential tools) amount to a 25-50bp of rate increases
  • Loan limits will be eased when housing pressure eases
  • Little the RBNZ can do to sustainably alleviate an overvalued real exchange rate

Reserve Bank of New Zealand governor Wheeler speech: “About Reflections on 25 years of Inflation Targeting” … full text

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NZD/USD on its lows for the session as I update this post