27 Apr 2011

Reserve Bank seen as in no hurry to raise rate

8:00 am on 27 April 2011

ASB economist Jane Turner says the Reserve Bank will be in no hurry to raise interest rates while the shape of the economic recovery and the timing of Canterbury's rebuild remain so uncertain.

The bank lowered the Official Cash Rate from 3% to 2.5% on 10 March as insurance against economic activity being severely undermined by the earthquake on 22 February. The rate was set at 3% on 29 July, 2010.

Most economists expect the bank to leave the rate unchanged in its next review, to be issued on Thursday.

Mrs Turner says the central bank may have been able to refine its forecasts a little since the last review, but the outlook remains very uncertain.