The Reserve Bank of New Zealand (RBNZ) Assistant Governor John McDermott ruled out the interest rate hike, and noted that the interest rate hike is possible if demand weakens and inflation in New Zealand declines.

"Evidence of weakening demand and domestic inflationary pressures would prompt us to consider lowering interest rates," McDermott said on Thursday.

The RBNZ assistant governor pointed out that "monetary policy should remain stimulatory for a prolonged period".

He also said that the labour market should improve and inflation should rise before hiking interest rate.

McDermott noted that the central bank will continue to monitor wages and price-setting outcomes.