NZ building consents up 35% in the year to June

Wellington

NEW Zealand's construction boom has led to a 35 per cent surge in building consents in the year to June, soothing concern over rising house prices to reinforce expectations that the central bank would reduce interest rates further.

The Reserve Bank of New Zealand held interest rates at 2.25 per cent at its June review while voicing strong concern about rising house prices. Economists, however, are now expecting it to cut rates to 2 per cent at a policy review on Aug 11.