In an unscheduled announcement, RBNZ lowered Official case rate by -0.75% to 0.25%, and pledges to keep it there for at least the next 12 months. Additionally, should further stimulus be required, a “Large Scale Asset Purchase Programme” of government bonds would be preferable to another OCR cut.
In the statement, it said that “negative economic implications of the COVID-19 virus continue to rise warranting further monetary stimulus.” The impact to the New Zealand economy “is, and will continue to be, significant”. Demand will be “constrained”, as will domestic production. Spending and investment will be “subdued for an extended period”.
