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As Central Banks Follow New Zealand's Lead, All Eyes Are on Its Next Move

  • Head-start on tightening makes it a proxy for those following
  • Economists see recession risks likely to curtail hiking plans
Adrian Orr, governor of the Reserve Bank of New Zealand.
Adrian Orr, governor of the Reserve Bank of New Zealand.Photographer: Mark Graham/Bloomberg

Thirty years after New Zealand’s central bank pioneered inflation targeting, it’s once again cutting a track for others to follow.

It was one of the first among developed nations to begin withdrawing pandemic stimulus last year and its decision to accelerate the pace of interest-rate increases this year foreshadowed what would come from counterparts in the US, Australia and Canada.