From the New Zealand Institute of Economic Research (NZIER) 'shadow board' - advice for the RBNZ
In brief ...
- Recommends that the Reserve Bank leave the Official Cash Rate on hold
- Shadow Board see both upside and downside risks to the interest rate outlook
- General view is a bias towards tightening appropriate
- "Activity indicators remain healthy, with firms overall still looking to hire and invest. While inflation has eased recently, there are still pockets of inflationary pressure in sectors such as construction which face sustained pressure on capacity" said Christina Leung, Senior Economist at NZIER."Although inflation is back within the Reserve Bank's 1 to 3 percent target band, there is limited risk of an acceleration. The recent easing in inflation and softer than expected GDP adds to the case that there is little urgency to lift the OCR."
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I reckon the shadow board will get their wish granted - RBNZ to be on hold this week.
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NZIER's Monetary Policy Shadow Board is independent of the Reserve Bank of New Zealand
- Shadow Board participants indicate what they believe is the most appropriate Official Cash Rate setting for the economy
- That is, participants show where they think interest rates should be, its not a forecast
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ps. I posted this yesterday on the RBNZ meeting this week: RBNZ meet this week - all polled economists expect on hold
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the Reserve Bank of New Zealand announcement is due at 2100GMT Wednesday 9 August 2017
