The Reserve Bank of New Zealand kept its official cash rate unchanged at 1.75%, citing global economic growth in recent quarters, although inflation and wage outcomes remain subdued across advanced economies.

The central bank said New Zealand's GDP in the March quarter was lower than expected. It expects growth to improve due to accommodative monetary policy, strong population growth, fiscal stimulus and higher trade.

House price inflation continued to moderate, a trend the bank said it expects to persist. However, the bank warned of a resurgence in prices amid population growth and resource constraints in the construction sector.

Meanwhile, headline inflation is expected to decline in the coming quarters, the bank said, as the effects of higher fuel and food prices dissipate.

Over the longer term, inflation is expected to stay at around 2%.

The bank said it will maintain its accommodative monetary policy for a considerable period, but adjustments may be made as uncertainties remain.