New Zealand has raised interest rates for the first time in seven years in a bid to control rapidly rising property prices.
The Reserve Bank of New Zealand lifted the country’s benchmark lending rate by 25 basis points to 0.5% yesterday and signalled that further rises were likely.
The bank said that house prices in the country had become “unsustainable” and that the tightening measures, as well as higher mortgage rates, would help avoid sharp crashes.
