"What makes Bagrie so sure that New Zealand will in fact see a rise in inflation next year due to our 'booming' economy that will in turn necessitate a rise in interest rates?"
The dollar rises after Reserve Bank says it will act as heat in the housing and construction sector spills into the broader economy.
"Although removal of monetary stimulus will likely be needed in the future, we expect to keep the OCR unchanged through the end of the year" – RBNZ governor Graeme Wheeler
Either of them could force the bank's hand to move on interest rates.
"RBNZ, enough of the 'mulling' over macro-prudential tools to deflate an (Auckland) property bubble. Mulling doesn't solve problems, actions do."
Reserve Bank governor Graeme Wheeler focuses on balancing the competing tensions of an "over-valued" currency and an overheating property market.
"This is clumsy logic. Spring is usually hot time for property. So let's raise the OCR after spring/summer?"