Accessibility/Mobile Features
Skip Navigation
Skip to Content
Editorial News
Business
Classified Sites

The Canadian Press - ONLINE EDITION

New Zealand hikes interest rates for third time to 3.25 per cent as economy picks up steam

WELLINGTON, New Zealand - New Zealand on Thursday raised its benchmark interest rate for the third time this year to 3.25 per cent.

The country's Reserve Bank said the economy has "considerable momentum" and is growing at about a 4 per cent annual clip.

New Zealand is among the first industrialized nations to begin raising rates since the 2008 global financial crisis. Its economy has benefited from strong demand in China for its milk exports and rebuilding efforts in the city of Christchurch following a 2011 earthquake.

However, the rate hikes have put upward pressure on the New Zealand dollar with global investors attracted to rising returns on New Zealand financial assets. That, in turn, has hurt exporters.

After Thursday's rate hike, the New Zealand dollar jumped to $0.8653 from $0.8612 late Wednesday.

The Reserve Bank forecasts the economy's growth rate will ease over the coming year.

Reserve Bank Governor Graeme Wheeler said dairy prices have fallen by 26 per cent since February from historic highs, meaning lower incomes for farmers.

Wheeler said house price inflation, which has been a big concern of the bank, has moderated in recent weeks.

Overall inflation is running at about 1.7 per cent, with the Reserve Bank predicting it will rise to about 2 per cent next year.

  • Rate this Rate This Star Icon
  • This article has not yet been rated.
  • We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high. If you thought it was well written, do the same. If it doesn’t meet your standards, mark it accordingly.

    You can also register and/or login to the site and join the conversation by leaving a comment.

    Rate it yourself by rolling over the stars and clicking when you reach your desired rating. We want you to tell us what you think of our articles. If the story moves you, compels you to act or tells you something you didn’t know, mark it high.

Sort by: Newest to Oldest | Oldest to Newest | Most Popular 0 Commentscomment icon

You can comment on most stories on brandonsun.com. You can also agree or disagree with other comments. All you need to do is register and/or login and you can join the conversation and give your feedback.

There are no comments at the moment. Be the first to post a comment below.

Post Your Commentcomment icon

Comment
  • You have characters left

The Brandon Sun does not necessarily endorse any of the views posted. Comments are moderated before publication. By submitting your comment, you agree to our Terms and Conditions. New to commenting? Check out our Frequently Asked Questions.

letters

Make text: Larger | Smaller

Brandon Sun Business Directory
The First World War at 100
Why Not Minot?
Welcome to Winnipeg

Social Media

Canadian Mortgage Rates