[BREAKING NEWS] What the RBNZ said today about interest rates

Annual consumers price inflation will likely increase towards the top of the Monetary Policy Committee’s 1 to 3% target band over mid-2025. However, with spare productive capacity in the economy and declining domestic inflation pressures, headline inflation is expected to remain in the band and return to around 2% by early 2026.

Elevated export prices and lower interest rates are supporting a recovery in the New Zealand economy. However, heightened global policy uncertainty and tariffs are expected to reduce global economic growth. This will likely slow the pace of New Zealand’s economic recovery, reducing inflation pressures.

The economic outlook remains highly uncertain. Further data on the speed of New Zealand’s economic recovery, the persistence of inflation, and the impacts of tariffs will influence the future path of the Official Cash Rate.

If medium-term inflation pressures continue to ease as projected, the Committee expects to lower the Official Cash Rate further.