RBNZ's Gourley: Rates Likely to Rise Sooner Rather Than Later

RBNZ's Gourley: Rates Likely to Rise Sooner Rather Than Later

Reserve Bank of New Zealand (RBNZ) Monetary Policy Committee member Hayley Gourley said interest rates are expected to rise 'sooner rather than later', after voting to hike at this week's finely balanced policy meeting.

The RBNZ held the official cash rate at 2.25% on Wednesday after Governor Anna Breman used her casting vote to break a 3-3 split. Gourley, an agribusiness executive, was one of three members who favoured a 25-basis-point increase.

'I think the track shows that we're certainly expecting change sooner rather than later,' Gourley said in an interview. She noted that what is learned in the five to six weeks before the July meeting will determine the speed and magnitude of change.

Gourley said she had wanted to raise rates in May because external shocks, including the Middle East conflict and rising inflation among trading partners, were likely to feed into domestic price pressures. An early move could help keep inflation expectations anchored, she added.