Heteronomics Archive

July 09, 2025

RBNZ: Policy Rate Held At 3.25% (Consensus 3.25%) in Jul-25

The RBNZ unanimously held the OCR at 3.25% after six consecutive cuts, marking the first pause in its easing cycle as inflation edges towards the top of the 1-3% target band.
The Committee maintains an explicit easing bias, signalling that further rate cuts are expected if medium-term inflation pressures continue to ease as projected.
Future monetary policy decisions will be heavily influenced by global trade tensions, domestic economic recovery momentum, and inflation expectations amid an explicitly uncertain outlook.

May 28, 2025

The RBNZ reduced the Official Cash Rate by 25 basis points to 3.25%, in line with consensus expectations, citing subdued core inflation, spare economic capacity, and global headwinds.
The decision, reached by a 5-1 majority, reflects internal debate over the pace of easing and a shift toward a more data-dependent policy approach, with no explicit guidance on further rate cuts.
Evolving global trade tensions will influence future interest rate decisions, domestic inflation expectations, and the pace of economic recovery, with the OCR projected to reach 3.00% by year-end but subject to heightened uncertainty.

April 09, 2025

As widely expected, the Monetary Policy Committee reduced the OCR by 25 basis points to 3.5%, citing stable inflation near the midpoint of the target range and significant spare capacity in the domestic economy.
The recent imposition of global trade barriers has increased downside risks to economic activity and inflation, prompting a reassessment of the medium-term inflation outlook.
While global inflation dynamics remain uncertain, the Committee signalled that further rate cuts remain possible, contingent on the evolution of inflationary pressures and external economic developments.

February 19, 2025

The Monetary Policy Committee reduced the OCR by 50 basis points to 3.75%, in line with expectations, citing declining inflationary pressures and significant economic slack, with further cuts likely through 2025.
While near-term inflation may experience volatility due to exchange rate depreciation and higher fuel costs, core inflation and inflation expectations remain well-anchored around the target midpoint.
Global risks, including trade policy uncertainty and geopolitical fragmentation, pose downside risks to growth. Still, the Committee remains confident that maintaining inflation stability will provide flexibility to respond to future shocks.