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Feature Article
The RBNZ, OCR and International Investments

What are the implication for investors now that the Reserve Bank of New Zealand (RBNZ) has moved the official cash rate (OCR) to 3.5 percent? New Zealand has seen interest rate changes over the last 10 years from 8.25 percent seven years ago (pre GFC) to more recent relatively low interest rates of 2.5 percent.

Typically, low interest rates are good for an economy as they encourage investment and growth by offering lower cost of borrowing capital allowing companies to fund projects and increase profits. ...

The Week That Was

Another week passed with growing concerns in Ukraine, following the downing of a passenger jet, that will more than likely lead to deeper sanctions against Russia. It appears likely that the plane was downed by Russian separatists with Russian military equipment and this is driving the reasoning for sanctions against Russia. What makes it less likely is that Putin will withdraw their support for the rebels is that he has gained support internally for the hard-line with Ukraine. What appears likely is that this tragic accident is likely to heighten the crisis rather than change its direction. Adding to uncertainty in Ukraine was the collapse of the Rada's majority coalition and Prime Minister Arseniy Yatsenyuk resigning. Meanwhile, Israel's brutal ground war in Gaza and no deal over Iran still get investors attention as each one of these could expand further and pose a significant risk to global markets if they do.

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