The RBNZ has kept official rates on hold at 1.5% in what was the expectation coming into the meeting.

One of the key comments that came out was the RBNZ saying that a lower OCR might be needed over time because of the weak global economic conditions and subdued domestic growth.

A key point from the minutes:

“The members agreed that more support from monetary policy was likely to be necessary.The Committee discussed the merits of lowering the OCR at this meeting. However, the Committee reached a consensus to hold the OCR at 1.5 percent. They noted a lower OCR may be needed over time.”

NZ has been experiencing a slowing housing and construction market recently as well as in the services sector.

As a result, the NZD/USD has sold off a touch, before rebounding. At the moment, we haven’t got a clear direction on the back of the release.

The USD rebounded overnight and that pulled the Kiwi back after a strong performance yesterday during the Asian session.

At the last meeting, it was somewhat of a surprise that the RBNZ cut rates to 1.5%. There were a few key indicators, the main one being weak inflation and it appeared the board wanted to get on the front foot.