wellington aug 18 reuters  reserve bank of new zealand governor adrian orr said on thursday the central bank was confident domestic inflation was now tracking lower we are at the low end globally and we are tracking in the right direction orr said in response to questions from parliaments finance and expenditure committee on wednesday the rbnz increased the cash rate by 50 basis points to 30 as it seeks to get inflation under control new zealand inflation is currently at threedecade highs having hit 73 in the second quarter he added that labour shortages were a key constraint on economic activity and that was a reason the central bank was working to consciously slow demand to better match capacity our outlook ahead shows that as spending growth slows labour is freed up he said he added that the central bank is also projecting an increase in inbound migration the central bank expects house prices will fall around 20 by mid2023 from their peak at the end on december 2021 orr said even with these falls prices would be above precovid levels but there will be and there is financial stress in many households because people have taken on significant mortgages significant commitments he said he said however new zealand was in a very good place to manage through this period of higher mortgage rates reporting by lucy craymer editing by leslie adler and sam holmes