RBNZ to hold the OCR at 1.75% next week - Westpac

Michael Gordon, Acting Chief Economist at Westpac, explains that Westpac expects the Reserve Bank of New Zealand to hold the OCR at 1.75% next week and to maintain a neutral outlook for interest rates.

Key Quotes

“In its May review the RBNZ regarded the recent jump in inflation as temporary, and noted that the softer than expected starting point for the economy would mean a more gradual lift in domestic inflation pressures. Recent developments will only bolster those views.”

“There is a risk that next week’s statement could emphasise the equal likelihood of rate cuts or hikes. That could rattle financial markets, which are largely focusing on rate hike scenarios.”