New Zealand Central Bank Serves Up 4th Straight Rate Hike Amid 'Too High' Inflation, Warns More To Come

The Reserve Bank of New Zealand on Wednesday hiked its official cash rate (OCR) by 50 basis points for the fourth consecutive time to 3%.

"It remains appropriate to continue to tighten monetary conditions at pace to maintain price stability and contribute to maximum sustainable employment," the central bank said in an accompanying monetary policy statement. 

RBNZ also said core consumer price inflation remained too high and labor resources were scarce.

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Inflation Target: The committee members agreed that monetary conditions needed to continue to tighten until the time they are confident there is sufficient restraint on spending to bring inflation back within its 1-3% per annum target range, the central bank said.

The committee agreed that further increases in the OCR were required in order to meet their inflation and employment objectives.

Expert Take: Nick Tuffley, chief economist at ASB Bank in Auckland told Bloomberg the release was “pretty hawkish under the hood."

“Our view is for a further 50bp increase in October, then two 25bp moves over November and February,” he said.

New Zealand Dollar: The USD/NZD pair was trading higher at 1.5768, rising from the recent low of 1.567.