New Zealand Central Bank Seen Holding Rate at 2.25% as Recovery Stays Fragile

9 articles · Updated · Bloomberg · May 25

New Zealand’s central bank is expected to leave its key interest rate unchanged at 2.25% on Wednesday, with policymakers seen pausing rather than tightening.
The expected hold reflects a willingness to look through inflation pressure from the Middle East energy shock in order to support a still-fragile economic recovery.
That policy backdrop comes as New Zealand’s housing market remains under scrutiny after a sharp bubble deflation, a trend being watched in Australia for lessons on softer property conditions.
In Australia, NAB has already tightened home-lending assumptions by no longer including certain tax breaks for properties sold after budget tax changes were announced.

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