New Zealand central bank unexpectedly holds rates, signals likely hikes - The Business Times

This comes 10 days before a general election where the outlook for the economy and inflation remains a key issue [AUCKLAND] New Zealand’s central bank unexpectedly held its benchmark official cash rate at 2.75 per cent on Wednesday (Oct 28) by a narrow vote, but said that the committee agreed that tighter monetary policy is likely to be required, depending on the economic outlook. In a Reuters poll, 22 of 27 economists had forecast that the Reserve Bank of New Zealand (RBNZ) would raise the cash rate by 25 basis points. The New Zealand dollar dropped sharply to US$0.5590 from US$0.5676, and two-year swaps fell from a high of 4.1109 per cent to a low of 3.9497 per cent after the surprise decision.