Monetary Policy Decision

Media Conference – 8 JULY 2025

Decision
The cash rate target remains unchanged at 3.85 per cent. The policy decision was made by a majority vote: 6 in favour, 3 against.

Inflation
Inflation has eased significantly since its 2022 peak, with underlying inflation expected to continue moderating toward the 2–3% target range. Recent data are slightly stronger than forecast but broadly in line.

Economic and Labour Market Conditions
Global uncertainty and trade tensions persist, affecting growth prospects. Domestically, demand is recovering gradually, though some sectors struggle to pass on costs. The labour market remains tight, despite softer wage growth and weak productivity.

Monetary Policy Stance
The Board views risks to inflation as balanced but remains cautious, choosing to wait for more information before making policy changes. It remains focused on achieving price stability and full employment and is prepared to act if necessary.