New Zealand central bank Governor Graeme Wheeler said he will keep interest rates unchanged for some time amid a wave of policy easings by his peers in the face of global disinflation pressures.
“Future interest-rate adjustments, either up or down will depend on the emerging flow of economic data,” Wheeler said Wednesday in a speech in Christchurch, reiterating his rate decision Jan. 29. He said an easing in policy may be justified if domestic demand deteriorated and price pressures abated further, “perhaps in response to drought or a worsening in external economic circumstances.”
Most economists predict no change in borrowing costs until 2016 after Wheeler last week moved to a neutral policy setting. Few forecast he will join counterparts in Canada and Australia who have cut rates in recent weeks because New Zealand’s economy is projected to grow 3 percent this year and policy makers are wary of reigniting house-price inflation.