The New Zealand Reserve Bank on Thursday cut the interest rate by a quarter of a per cent to an all-time low of 1.75%.

    Reserve Bank governor Graeme Wheeler said the exchange rate remained higher than was sustainable for balanced economic growth, the (dpa) reported. "Significant surplus capacity exists across the global economy (and) global inflation remains weak," he said.  "Political uncertainty remains heightened and market volatility is elevated." The move was expected by financial markets, and was not related to the US presidential election. 

    Economists in the banking sector are not expecting further cuts in the interest rate, although Wheeler did not rule out future adjustments. "Numerous uncertainties remain, particularly in respect of the international outlook, and policy may need to adjust accordingly." The New Zealand dollar rose from 72.90 US cents to 73.60 US cents after the announcement.