Following the decision of the Reserve Bank of New Zealand (RBNZ) on Wednesday, Deputy Prime Minister Grant Robertson is confident that the country can avoid recession even if the central bank continues to aggressively raise interest rates.
Although admitting that this year will be challenging due to the global slowdown, but with the work done by the central bank, they can maintain balance until next year and avoid a recession.
The RBNZ on Wednesday raised rates by 50 basis points and signaled more hikes to come as it tries to curb inflation that hit a 32-year high in the second quarter.
Meanwhile, New Zealand also reported a better-than-expected annual budget deficit as the economy performed positively.
Robertson, who is also the country's finance minister, also said that labor shortages remain a major economic issue at the moment.
However, he rejected suggestions that the situation could worsen if citizens went abroad to chase higher wages.
