Reserve Bank of New Zealand

Forecasts ....

  • RBNZ sees official cash rate at 1.49% in June 2022 (pvs 1.51%)
  • RBNZ sees official cash rate at 2.57% in March 2023 (pvs 2.3%)
  • RBNZ sees twi nzd at around 71.6% in March 2023 (pvs 75.1%)
  • RBNZ sees annual cpi 3.2% by march 2023 (pvs 2.9%)
  • RBNZ sees official cash rate at 2.84% in June 2023 (pvs 2.4%)
  • RBNZ sees official cash rate at 3.35% in March 2025

RBNZ minutes:

  • committee also affirmed that it was willing to move the OCR in larger increments if required over coming quarters
  • OCR is expected to peak at a higher level than assumed at the November statement
  • sales of the bank’s LSAP bond holdings may put some upward pressure on longer-term interest rates
  • many members saw this as a finely balanced decision whether to move the OCR up by 25 or 50 basis points
  • committee agreed that higher interest rates were consistent with house prices becoming more sustainable
  • impulse to growth from fiscal support is now ebbing and will wane
  • committee reached a consensus not to reinvest the proceeds for any upcoming LSAP maturities

RBNZ says

  • says committee agreed that further removal of monetary policy stimulus is expected over time
  • says headline cpi inflation is well above the reserve bank’s target range, but will return towards the 2 percent midpoint over coming years
  • employment is now above its maximum sustainable level
  • says broad range of economic indicators highlighting that the New Zealand economy continues to perform above its current potential.
  • says managed sales of bond holdings, in addition to not investing the proceeds of maturities, were most consistent with achieving their mandate over time
  • says intends to commence bonds sales in July

Headlines summary above is via Reuters


The hike was as expected although some had been tipping 0.5%. The statement, minutes, and forecasts are all leaning more hawkish, the jump in NZD/USD reflecting this.

Governor Orr is up next, at 0200 GMT. The guy is a man of action, not waffle like some other central bankers.

RBNZ Orr chuck norris meme