(Bloomberg) -- New Zealand central bank governor Adrian Orr said policymakers decided against raising interest rates this week because latest data confirmed that inflation is slowing.

“The data I think is really the story,” Orr told Bloomberg Television Thursday in Wellington. They have presented “a lot of confirmation that inflation has and is continuing to decline.”

The Reserve Bank on Wednesday held its Official Cash Rate at 5.5%, as expected by most economists. But two forecasters, including ANZ Bank, had predicted a rate increase. 

Orr said the Monetary Policy Committee did discuss a hike but the cash rate is already “well above any estimate of a neutral interest rate for New Zealand” and “we’re unambiguously in a restrictive monetary position.”

Asked if it would have be risky to hike rates further, he said: “Yes, there is always a risk of overdoing it at either end of monetary policy. This is why patience is critical.”

“When you’re sitting in a position where you’re confident you’re being restrictive, you’re confident the economy and the monetary policy transmission is working as anticipated, then have patience,” Orr said. 

While risks to the outlook are balanced, Orr said the RBNZ doesn’t want to see any upside inflation surprises.

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