New Zealand's central bank cut its official cash rate by a quarter percent to 8 percent Thursday, its first cut in the key rate for five years, reported AP. Reserve Bank Governor Alan Bollard said a rapidly slowing economy sparked the rate cut in spite of annual inflation of 4 percent that is expected to peak at 5 percent by October. He indicated further cuts were likely later this year. Bollard had earlier suggested the first rate cut was likely at the central bank's September review. But he said more «unpleasant news» had emerged since the bank's rate review in June and there was a risk the domestic economy would slow further.
