The Reserve Bank of New Zealand lowered its official cash rate (OCR) by 50 basis points to 4.75% during its October 2024 policy meeting, marking the second consecutive rate cut and aligning with market expectations. New Zealand's annual inflation rate eased to 3.3% in Q2 2024, from 4% in the previous quarter and below market expectations of 3.5%. This also marked the lowest inflation reading since Q2 of 2021, bringing it back within the central bank's target range of 1-3%. New Zealand's economy now faced excess capacity, prompting adjustments in price and wage-setting toward a low-inflation environment. Consequently, the Reserve Bank opted to ease monetary policy to maintain stable inflation, while minimizing disruptions to output, employment, interest rates, and the exchange rate. source: Reserve Bank of New Zealand
