Reserve Bank Of New Zealand Rate Statement
Event Date: Wednesday, November 11, 2020
Event Time: 02:00 CET
Updated Wednesday, November 4, 2020
RBNZ Governor Adrian Orr is due to speak about the future of New Zealand’s monetary policy framework and the economic projections of the Reserve Bank of New Zealand, in Wellington. Audience questions are expected, which will make his speech very interesting for NZD traders. Recently we have seen four major central banks shift from neutral/hawkish to dovish/neutral. The New Zealand economy has weakened as well as the other developed economies. The RBNZ cut interest rates in the August meeting last year and in March to 0.25%, but is not expected to cut again this time. But it would be interesting to see where they stand now since coronavirus didn't really penetrate New Zealand, while in other countries it has stopped the economy dead, but I expect them to be less dovish, or even slightly hawkish now.
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About Reserve Bank Of New Zealand Rate Statement
The Official Cash Rate (OCR) is the price of borrowing money, or official interest rate, in New Zealand. It is set by the Reserve Bank of New Zealand (RBNZ) and revisited eight times annually. The OCR is the mechanism by which the RBNZ controls inflationary pressures. Target inflation is to remain between 1% and 3% for the intermediate-term. The OCR is adjusted periodically in adherence to a 2% goal of stated inflation.The RBNZ Press Conference is the official release of the OCR to the public. A hike in rates reflects a desire by the RBNZ to limit inflationary pressure and is a bullish influence on the New Zealand dollar (NZD). Holding the OCR steady, or cutting rates, is a signal of lagging inflation and stagnant economic growth. These actions are typically deemed as bearish against the NZD.The RBNZ Interest Rate Decision is a primary driver of participation for the NZD. Upon its release in the RBNZ Press Conference, pricing volatility increases substantially. Conferences and speeches form the RBNZ Governor Orr are also very important as they give an insight of the monetary policy of the RBNZ.