2017.06.2118:30:00UTC+00RBNZ Maintains Official Cash Rate At 1.75%

The Reserve Bank of New Zealand on Thursday kept its Official Cash Rate unchanged at the record low of 1.75 percent for the fourth straight meeting.

The decision was in line with expectations following a rate cut in November. Following no move in September, the central bank trimmed its benchmark by 25 basis points in August after holding fire for three straight months.

The central bank has pared a collective 1.50 percent from its benchmark in the last 12 months, lowering the rate in six of the last 11 meetings after six straight sessions with no change.

Macroeconomic indicators in advanced economies have been positive over the past two months, RBNZ Governor Graeme Wheeler noted.

"However, major challenges remain with on-going surplus capacity and extensive political uncertainty," Wheeler said in a statement accompanying the decision.

He also pointed to an increase in global headline inflation, thanks to a bump in commodity prices.

He added that monetary policy is expected to remain stimulatory - but added that it may be less so going forward.

"GDP growth in the March quarter was lower than expected, with weaker export volumes and residential construction partially offset by stronger consumption. Nevertheless, the growth outlook remains positive," Wheeler said.

Domestic inflation has eased somewhat, aided by a favorable decline in the exchange rate.

The bank added that domestic growth was slightly weaker than expected, although that situation is viewed as temporary - adding that the growth outlook continued to be favorable.

"Monetary policy will remain accommodative for a considerable period. Numerous uncertainties remain, particularly in respect of the international outlook, and policy may need to adjust accordingly," Wheeler said.