RBNZ Governor Orr's Press conference has now...>

RBNZ: RBNZ Governor Orr's Press conference has now concluded, in summary:

- The Bank left the OCR unch. at 1.75%, but pushed the horizon that it exp. to

hike the OCR by 25bp out to Dec 2020 (prev. Mar 2020). Near term exp. revised a

touch lower, near term inflation exp. a touch higher. The Bank noted that the

inflation path may be bumpy, stressing that it will look through volatility &

that risks to inflation are broadly balanced, after noting early signs of rising

core inflation. The Bank noted that risks to growth are tilted to the downside

highlighting that the recent moderation in growth may last longer than exp.,

with low business confidence potentially weighing on investment. Orr noted that

if growth slows further below potential then the RBNZ would cut the OCR.

- On the labour mkt front, the RBNZ now expects the unemp. rate to decline

modestly from current levels, with emp. around its "maximum sustainable level."

- The Bank also revised its NZD TWI exp. To 72.8 from 74.0, noting that it

expects the lower NZD to support export earnings. Orr noted that the NZD will be

the number one shock absorber if global risks rise, while noting that he is

"very pleased" with the level of the kiwi, which he deems close to fair value.