[UPDATE] RBA holds cash rate at 4.35%, resolving August hike debate
Monetary policy · Decided 11 Aug 2026
The RBA board unanimously left the cash rate at 4.35% on 11 August, settling the split among Australian banks over whether a further hike was imminent. Governor Bullock said the board remains concerned about elevated trimmed-mean inflation and wants more evidence policy is working before moving again.
Why it matters — A hold rather than a hike removes near-term upside pressure on trans-Tasman funding costs and NZD/AUD cross-rate volatility, though the RBA kept the door open to further tightening if inflation does not ease.
Banks now pencil in OCR reaching 3% by year-end after July's hike to 2.50%
Monetary policy
With the OCR now at 2.50% following July's hike, most major bank economists expect two more quarter-point moves — in September and October — to take it to 3.00% by year-end, while BNZ forecasts NZD/USD drifting toward 0.59 by year-end and 0.60 by March 2027.
[UPDATE] RBNZ signals more OCR hikes likely, pegs neutral rate near 3%
Monetary policy · Press conference 8 Jul 2026, following OCR hike to 2.50%
Following Wednesday's surprise OCR hike to 2.50%, Governor Anna Breman said the Committee will likely need to withdraw further monetary stimulus, though timing is uncertain, and put the neutral OCR range at roughly 2.5%-3.5%; the Bank's forecast has inflation peaking at 3.9% in Q2 before easing to 3.3% in Q3 and back to the 2% midpoint by mid-2027, with GDP nowcast at +0.6% for Q3.
Why it matters — The clearest signal yet that the tightening cycle isn't over — markets are now pricing the OCR toward 3.00% by year end, directly shaping bank funding costs and deposit/mortgage pricing strategy.
Bank economists now pencil in RBNZ hikes from September, ahead of Wednesday's OCR call
Monetary policy · OCR review scheduled 2pm, 8 July 2026
ASB, Westpac and ANZ economists are forecasting the RBNZ will hold the OCR at 2.25% this Wednesday before beginning consecutive 25bp hikes from September, taking the cash rate to 3.0% by year-end and a peak of 3.25% in early 2027 — a reversal from the cutting-cycle path priced in earlier this year.
Why it matters — A pivot from cuts to hikes reshapes deposit and lending margin assumptions banks have been running for 2026 budgets; treasury and ALM teams should revisit repricing schedules ahead of the September pivot point.