RBNZ’s Bascand Commenting On Inflation

Reserve Bank of New Zealand Deputy Governor Geoff Bascand said on Monday that while longer-term inflation expectations in the country remain well anchored, short-term inflation expectations have increased.

Key Comments:

“The RBNZ will take considered steps for now.”

“Predicts unemployment rate to drift up to about 4%.”

“More confident that the labour market is tight and that will build inflation pressures.”

“Central Bankers must continue to look forward to guard against the unpredictable.”

“Confident our financial stability approach has strengthened; the foundations are more solid.”

“RBNZ should not be held responsible for the housing market.”

“RBNZ’s job is to limit financial stability risks and keep overall inflation under control.”

“RBNZ can lean against house prices by increasing cost & restricting the availability of credit.”

As for market’s reaction, the NZD has not seen any reaction to the latest comments from Bascand, which do not seem to have altered RBNZ tightening expectations.