Outlook for Borrowers: Post April MPR
The Reserve Bank of New Zealand (RBNZ) maintained the Official Cash Rate (OCR) at 2.25% at its latest Monetary Policy Review (MPR). Although committee members reportedly expressed a range of views, the decision was ultimately reached by consensus. The outcome was unanimously anticipated by economists and was consistent with market implied expectations that the policy rate would remain unchanged. As the announcement occurred at a policy review, the Bank did not publish a complete set of updated forecasts. However, it provided a partial assessment of the potential effects of the Middle East conflict on inflation.
Outlook for Borrowers: Post February MPS
The Reserve Bank of New Zealand (RBNZ) held the Official Cash Rate (OCR) steady at 2.25% at the Monetary Policy Statement (MPS) on Wednesday. This outcome was expected by economists and fully reflected in market pricing. The decision was reached by consensus. The updated modelled OCR track has a low point of 2.25% removing the marginal easing bias from November. The December quarter average was increased by 10bp to 2.38%, implying a greater chance of a rate hike towards the end of this year. The projected track for next year was also revised higher and the OCR reaches the Bank’s 3% long term neutral estimate by late 2028.