The New Zealand dollar strengthened slightly, trading at US62.14 cents from US61.90c against the American greenback after the announcement.
The Reserve Bank said global economic growth remained weak and inflation pressures were easing. Core inflation in New Zealand was expected to decline as capacity constraints eased.
While employment was above its maximum sustainable level, there were signs of labour market pressures dissipating and vacancies declining.
House prices were now around sustainable levels, consumer spending growth had eased and residential construction activity had declined, the Reserve Bank said.
ANZ Research still expects the Reserve Bank to increase the cash rate 25 basis points in November. “For now, inflation indicators continue to fall obediently and the Reserve Bank’s pause is highly credible,” it said in a report.
The ASB said in a report that “we don’t expect rate cuts until May next year, give or take.”
Transport software firm Eroad rose 7c or 5.38 per cent to $1.37 after announcing that the unsolicited takeover offer from Volaris Group subsidiary Brillian APAC undervalued its business and it will not be granting due diligence.
Brillian recently increased its stake in Eroad from 17.734 per cent to 18.737 per cent after buying 1.17 million shares on the market. Brillian offered to buy all of Eroad’s remaining shares at $1.30 a share.
McConnochie said shareholders will just have to wait and see if any better offer comes along.
KMD Brands was down 9c or 8.65 per cent to 95c after telling the market it will pass $1 billion in group sales for the first time at the end of the latest financial year in July.
Total sales are expected to reach $1.1b and operating earnings (ebitda) $105m-$110m with three weeks of trading remaining. But KMD said fourth-quarter trading has been challenging through softening consumer sentiment and Kathmandu experienced a slower start to its winter trading. Its main market Australia has had a warmer start to the winter.
Ebos Group was down 29c to $37.71; Mainfreight declined 48c to $71; Infratil decreased 9c to $9.86; Meridian Energy shed 5c to $5.50; and Manawa Energy was down 8c to $4.92.
Scales Corp fell 9c or 2.65 per cent to $3.31; Sanford decreased 7c to $4.07; Vista Group was down 5c or 2.7 per cent to $1.80; Tourism Holdings shed 5c to $3.53; and My Food Bag declined 1c or 4.35 per cent to 22c.
Freightways rebounded strongly, rising 20c or 2.38 per cent to $8.61; Chorus was up 17c or 2.09 per cent to $8.30; Auckland International Airport added 9.5c to $8.33; Fletcher Building gained 6c to $5.41; and Mercury Energy increased 6c to $6.50.
Leading banks ANZ and Westpac rose, ANZ up 41c to $25.87 while Westpac collected 40c to $23.10.
The retirement sector continued its recovery as the housing market steadied with Summerset Group up 5c to $10.35, and Ryman Healthcare also gaining 5c to $6.85. Radius Residential Care increased 2.5c or 12.2 per cent to 23c.
The Reserve Bank said house prices have stabilised in recent months and the outlook for the market has become more balanced. Higher net migration is supporting demand for housing, but higher interest rates continue to exert downward pressure on housing demand.
Winton Land rose 9c or 4.48 per cent to $2.10; Vulcan Steel was up 21c or 2.31 per cent to $9.29; Task Group increased 2c or 3.77 per cent to 55c; 2 Cheap Cars added another 4c or 8.33 per cent to 52c; Rua Bioscience improved 1c or 6.37 per cent to 16.7c; and Black Pearl Group was up 3c or 6.98 per cent to 46c.
Me Today, unchanged at 0.007c, is considering halving its beekeeping operations to 2000 hives after finishing up with a 500-tonne mānuka honey inventory, sufficient to meet forecast demand. Me Today is looking at closing the Wairarapa branch and continuing a smaller beekeeping operation at Turangi.
