New Zealand Finance Minister Willis says the government is working to cut inflation

NZ Finance Minister Nicola Willis spoke after the RBNZ ‘on hold’ decision yesterday.

I’ve said the Statement from the Bank was read as hawkish but subsequent comments from Governor Orr at the following media conference were not nearly so hawkish. Summary is here, you decide:

• ForexLive Asia-Pacific FX news wrap: NZD jumped on a more hawkish RBNZ Statement

Willis:

• ”The reality is inflation is still not back to target.“
• ”We’re funding tax reduction through savings, reprioritisation.”
• government had confidence it could reduce taxes and bring inflation back to target levels

Yeah, there is still work to be done. Orr said he expects inflation to be back in the target band by the end of this year. Good news if so.

NZD began its retrace from bing marked higher on the Statement pretty much straight away. It retraced more as the press conference progressed. Overnight it slid with pretty much everything else into and then over the FOMC Minutes.

This article was written by Eamonn Sheridan at www.forexlive.com.