\nThe Reserve Bank of New Zealand (RBNZ) is the country\u2019s central bank. Its economic objectives are achieving and maintaining price stability \u2013 achieved when inflation, measured by the Consumer Price Index (CPI), falls within the band of between 1% and 3% \u2013 and supporting maximum sustainable employment.<\/p>\n<\/section>\n\nThe Reserve Bank of New Zealand\u2019s (RBNZ) Monetary Policy Committee (MPC) decides the appropriate level of the Official Cash Rate (OCR) according to its objectives. When inflation is above target, the bank will attempt to tame it by raising its key OCR, making it more expensive for households and businesses to borrow money and thus cooling the economy. Higher interest rates are generally positive for the New Zealand Dollar (NZD) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken NZD.<\/p>\n<\/section>\n\nEmployment is important for the Reserve Bank of New Zealand (RBNZ) because a tight labor market can fuel inflation. The RBNZ\u2019s goal of \u201cmaximum sustainable employment\u201d is defined as the highest use of labor resources that can be sustained over time without creating an acceleration in inflation. \u201cWhen employment is at its maximum sustainable level, there will be low and stable inflation. However, if employment is above the maximum sustainable level for too long, it will eventually cause prices to rise more and more quickly, requiring the MPC to raise interest rates to keep inflation under control,\u201d the bank says.<\/p>\n<\/section>\n\nIn extreme situations, the Reserve Bank of New Zealand (RBNZ) can enact a monetary policy tool called Quantitative Easing. QE is the process by which the RBNZ prints local currency and uses it to buy assets \u2013 usually government or corporate bonds \u2013 from banks and other financial institutions with the aim to increase the domestic money supply and spur economic activity. QE usually results in a weaker New Zealand Dollar (NZD). QE is a last resort when simply lowering interest rates is unlikely to achieve the objectives of the central bank. The RBNZ used it during the Covid-19 pandemic.<\/p>\n<\/section>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
\u00a0<\/p>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"
AUD\/NZD gains momentum around 1.1075 in Wednesday\u2019s Asian session, up 0.63% on the day.\u00a0 The RBNZ \u00a0maintained the Official Cash Rate (OCR) unchanged at 5.50% at its July meeting on Wednesday, as widely expected.\u00a0 The RBA\u2019s hawkish stance lifts the Aussie against the Kiwi.\u00a0 The AUD\/NZD cross attracts some buyers near 1.1075 during the Asian […]<\/p>\n","protected":false},"author":2,"featured_media":9955,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[173],"tags":[201,248,251,246,257,255,684,250,333,277,715,252,247,253,714,249,256,254],"class_list":["post-341076","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-others","tag-blockchain","tag-bsc","tag-chainlink","tag-coin","tag-cryptocurrency","tag-gta","tag-interestrate","tag-looks-rare","tag-macroeconomics","tag-majors","tag-nzdusd","tag-oracle","tag-polygon","tag-quickswap","tag-rbnz","tag-safe-moon","tag-wallet","tag-wordpress"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/341076","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=341076"}],"version-history":[{"count":3,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/341076\/revisions"}],"predecessor-version":[{"id":341082,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/341076\/revisions\/341082"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media\/9955"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=341076"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=341076"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=341076"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}