The New Zealand central bank maintains interest rates at 5.5%

Madrid, Oct. 4 (Europe Press) –

New Zealand’s central bank’s monetary policy committee agreed this Wednesday to keep the official interest rate at 5.50%, saying higher rates are still needed to control prices.

“The interest rate should be maintained at a controlled level to ensure that annual inflation returns to the target range of 1% to 3% and to support maximum sustainable employment,” the agency stressed in a statement.

New Zealand’s central bank said interest rates were restraining economic activity and easing inflationary pressures “as expected”.

However, while the imbalance between supply and demand in the New Zealand economy continues to moderate, the agency said “a longer period of moderation in action is needed to reduce inflationary pressures”.

“There is a short-term risk that activity and inflation will not decrease as much as needed. In the medium term, a further slowdown in global economic demand, particularly in China, will affect commodity prices and New Zealand export earnings,” the company notes.