Photo: RNZ
Low and stable inflation is in sight, but interest rates will need to be managed to dampen the last pockets of high price pressures, the Reserve Bank governor says.
In a speech to a US think tank in Washington on Thursday morning, Orr ran through the central bank's response to the Covid outbreak and how it affected monetary policy.
The pandemic required extraordinary measures, which stoked inflation, he said.
Orr said risks remained and there was still much uncertainty.
But as inflation pressures and expectations stabilised interest rates would continue to be lowered, which would lift the economy, he said.
The consumer price index hit a 3.5 year low earlier this month.
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