( dpa ) - New Zealand's central bank, which raised its benchmark interest rate four times last year in a bid to dampen a booming housing sector and contain inflation, left the rate at 8.25 per cent in a scheduled review of monetary policy on Thursday.
It is a record figure for the Reserve Bank and well above the average rate of just over 4.5 per cent for the world's 11 major central banks.
The decision followed news that inflation was 3.2 per cent last year, higher than expected and above the bank's target band of 0 to 3 per cent.
Reserve Bank governor Alan Bollard said, "While the housing market continues to cool, the labour market remains tight, domestic income growth is still strong, especially from dairy, and core inflationary pressures persist."
He said the bank was watching closely "ongoing turbulence" in international financial markets and a deteriorating outlook for US and European economies.
"Despite this, the New Zealand economy is projected to keep growing reasonably well," Bollard said. "Ongoing inflationary pressures are underpinned by an expansionary fiscal policy, and rising food and energy prices."