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What's interesting about the Reserve Bank governor's official cash rate review this week is that the accompanying statement doesn't seem to contain any of the significant changes in language that has become a feature of OCRs in recent times.
After slashing interest rates to 2.5% early last year, Alan Bollard has made a habit of using language to slowly hose down expectations of just how long the OCR would stay at such record low levels.
In April last year Bollard talked of not hiking the rate from 2.5% until the 'latter' part of 2010. Then, in the next statement it became the "second half of 2010" only to change in December to being "around the middle of 2010".
In Thursday's announcement Bollard has stuck with the "around the middle of 2010" sentence - a term I should note, in Reserve Bank speak, can probably be stretched to mean anything from May to September.
The 'steady as she goes' statement on Thursday shouldn't really come as a surprise though. Local economic data over the last few weeks has been pretty benign - in particular inflation.
There isn't really any need to change people's interest rate expectations at this stage. Bollard acknowledges this in his statement, saying that while the economy is improving, households remain cautious and credit growth muted.
In fact, ASB economists believe Bollard may even be slightly more relaxed about the inflation outlook in this statement than he was in December.
The next statement in March could well be similar in tone.
However, things could be different by April.
By then, Bollard will have a better reading on how the economy is shaping up this year.
December quarter growth figures will be out, as will first quarter inflation data.
Some economists believe at this point he will have to act more aggressively than previously indicated and hike interest rates by as much as 50 basis points. Others are still not so sure.
But, until then, it seems interest rates are likely - barring any more major economic shocks - to be in a bit of a holding pattern.
That's good news for those on floating mortgage rates , as it's now looking increasingly likely that it will be at the very least another two and a half months before home lending rates rises.
Bollard will on Friday speak to the Canterbury Chamber of
Commerce in Christchurch.
