Monetary policy

RBNZ expects inflation above 3% through 2026; economists see OCR heading to 3–3.25%

Monetary policy · Next decision: Monetary Policy Review, 28 Oct 2026, 2pm

The Reserve Bank expects annual inflation to stay above 3% for the rest of 2026, and economists broadly expect further hikes taking the OCR to around 3–3.25% over the next year. The next decision is a Monetary Policy Review on 28 October.

Source: RBNZ · RBNZ

RBNZ lifts OCR to 2.75% as inflation stays above target

Monetary policy · OCR raised 2 Sep 2026

The RBNZ's Monetary Policy Committee unanimously raised the OCR by 25 basis points to 2.75% — its second hike since tightening resumed in July — after June-quarter inflation rose to 4.1%, driven largely by fuel prices linked to the Middle East conflict. The Bank expects inflation to stay above 3% for the rest of 2026.

Why it matters — A second consecutive hike with inflation still nearly double target keeps funding costs and mortgage-rate pressure elevated into Q4 — treasury and ALM teams should assume no near-term easing bias.

Source: RBNZ

[UPDATE] RBNZ hikes OCR to 2.75%; big banks pass full rise to floating mortgage rates

Monetary policy · OCR decision 2 Sep 2026; rate changes effective 7-23 Sep

RBNZ raised the OCR 25bp to 2.75%, its second straight hike since resuming tightening in July, with inflation running at 4.1% in the June quarter. The Bank signalled a pause in October before a further move to 3.00% in December. ANZ, Westpac, BNZ, ASB and Kiwibank all passed the full rise on to floating mortgage rates within a day, taking floating rates to between 6.29% and 6.39%.

Source: RNZ · interest.co.nz

RBA hike timing splits Australia's big four economists

Monetary policy · Reported 4 Sep 2026, ahead of RBA's 29 Sep meeting

NAB, Deutsche Bank and UBS now expect the RBA to lift its cash rate 25bp to 4.6% at its 29 September meeting, citing sticky trimmed-mean inflation of 3.6%. CBA and ANZ pencil the hike in for November instead, while Westpac is the outlier, expecting no hike this year and cuts in 2027 — a rare public split among the big four's own economics teams.

Why it matters — A split this wide among the major banks' own economists adds uncertainty to funding-cost and mortgage-pricing forecasts for the NZ subsidiaries of ANZ, Westpac, ASB (CBA) and BNZ (NAB) heading into the December quarter.

Source: ABC News

[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.

Source: SBS News

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.

Source: exchangerates.org.uk

[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.

Source: interest.co.nz · RBNZ

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.

Source: FXStreet