Interest rates up but NZ dollar down

Reaction to today’s increase in the OCR actually saw the NZ$ fall. It is usual that higher rates of return attract what we call ‘Hot Money’ into the economy. However, Alan Bollard indicated that interest rates were not now expected to reach 6% as he had earlier predicted. He also indicated that the currency’s strength (72.66 cents v US$) was not indicative of the state of the economy.
Click here for NZ Herald article.

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