New Zealand's central bank governor reiterated on Friday that the bank will maintain its current easy policy settings for a prolonged period, saying it was prudent to be patient.
"I think our 'least regrets' policy now is making sure we don't do too much too soon," Orr said in a speech to business leaders at the Canterbury Employers' Chamber of Commerce in Christchurch.
"That we are prepared to show patience and wait to see that inflation, that employment and that business confidence are really back in New Zealand," he added.
The Reserve Bank of New Zealand (RBNZ) left the Official Cash Rate (OCR) unchanged at 0.25% earlier this week.
Orr also said he wants to maintain the option of negative rates, in case there's need to stimulate the economy further in the future.
"We could stimulate the economy even further with a negative OCR. That is an optionality, it's not an expectation at this point but it's about being prepared," he said.
Orr said the New Zealand dollar was operating near "fair value" when asked if the local currency was undervalued internationally.
"The exchange rate is out there in the minds of buyers and sellers ... at the moment it has been basically operating somewhere near vast groups of people's models of fair value," he said.
In a separate statement on RBNZ's website, Orr said the bank will consider its financial stability policy settings via prudential tools like loan-to-value ratios, bank stress testing, and capital requirements against particular types of mortgage lending to moderate housing demand.
The New Zealand government on Thursday tasked RBNZ with considering the impact its policy decisions were having on housing prices, a move to help calm the country's red-hot property market.
(Reporting by Praveen Menon; Editing by Shri Navaratnam and Sam Holmes)
