27 Jan 2012

Reserve Bank 'in no hurry' to raise interest rates

7:04 am on 27 January 2012

An economist says the Reserve Bank will be in no hurry to raise interest rates, as global turmoil continues to dominate the economic outlook.

As expected, the Reserve Bank left the cost of borrowing on hold at 2.5% on Thursday morning.

Reserve Bank Govenor Alan Bollard noted some improvement in global financial markets, but warned there is still a lot of uncertainty in the world economy.

ANZ chief economist Cameron Bagrie the decision was widely expected given the concerns about the global economy.

He says the statement's tone was very similar to last month's one, and gives little away about when interest rates will start rising again.

Mr Bagrie says he hopes a speech by Dr Bollard in Christchurch on Friday will shed more light about the approach the central bank's taking to navigating the effects of the European debt crisis, and the ongoing delays to the Canterbury rebuild.