Consumers expect rate rise: ASB
A total of 33% of respondents to ASB’s survey said they believed the OCR rate would go up over the next year, up from 32% in the three months to April.
Interest rate expectations were broadly similar across the country, with 31% to 33% of people expecting a rise over the next year.
The expectations come despite the Reserve Bank’s surprisingly cautious statement last week. The central bank said it expected the OCR rate to remain at an historic low until 2020, due to sluggish economic growth.
ASB’s Nick Tuffley said consumers were confident rates would remain low in the long term: “We expect the OCR to move up from November 2019, but assume a gradual path of policy tightening and a historically-low OCR endpoint this cycle. This should ensure that mortgage interest rates stay reasonably low over the next few years and is likely to temper respondents’ expectations."
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