Interest Rate Strategy

Outlook for Borrowers: Post April MPR

Stuart Ritson -

The Reserve Bank of New Zealand (RBNZ) held the Official Cash Rate (OCR) steady at 5.5% at the Monetary Policy Review (MPR) on Wednesday. The statement, accompanying the expected ‘on hold’ decision, indicated there is little change in the Bank’s assessment of the economy and inflation outlook from the February Monetary Policy Statement (MPS). The Monetary Policy Committee is ‘confident that maintaining the OCR at a restrictive level for a sustained period’ will return inflation to target this year.

Update on syndication of May 2035 nominal NZGB

Stuart Ritson -

New Zealand Debt Management (NZDM) announced, alongside the Pre-election Economic and Fiscal Update in September, that a new 15 May 2035 nominal maturity will be syndicated this fiscal year. There was a further update in the March tender schedule that the 2035 maturity will be launched by the end of April 2024. The release of the syndicate panel banks today suggests a transaction is imminent. We expect it to launch on 2 April with pricing taking place the following day.

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Outlook for Borrowers: Post February MPS

Stuart Ritson -

The Reserve Bank of New Zealand (RBNZ) held the Official Cash Rate (OCR) steady as expected, at 5.5%, at the February Monetary Policy Statement (MPS). The Bank, although remaining hawkish, eased its rhetoric from the previous MPS in November. A mild tightening bias was retained but Monetary Policy Committee (MPC) members noted that overall, risks to the outlook for inflation were more balanced than at the time of the November 2023 Statement.