OCR

The Reserve Bank still sees the official cash rate peaking at 5.5 per cent despite the devastation from Cyclone Gabrielle. The Monetary Policy Committee agreed ...

And the starting point for inflation is one of red-hot pressure,” Tuffley said. “It is too early to accurately assess the monetary policy implications of these weather events, given that the scale of destruction and economic disruption are only now becoming evident. In wholesale interest rates, the two-year swap rate was little-changed at 5.31 per cent. Increases of 50 and 75 basis points were considered. “The best contribution monetary policy can make is to free up resources by slowing demand elsewhere in the economy with higher interest rates. “Export revenues will be negatively impacted.

Speaking to Breakfast this morning, Devon Funds' Greg Smith said he thinks the Reserve Bank (RBNZ) could hike the OCR by half a percent.

"They [RBNZ] want to get it lower but they don't necessarily want to sink the economy as well but I think they certainly are near the end of this rate tightening process." "It's going to cost the economy billions of dollars, tens of billions plus, could actually tip the economy into recession." "They're looking to drive inflation down, its come down a bit but it needs to go lower and there will be inflationary pressures coming out of the cyclone and the flooding."

Jen Baird, Chief Executive at REINZ says: “The Reserve Bank's announcement today of another increase to the OCR will impact both buyers' and sellers' ...

Government: Budget 2023 Date Confirmed New Budget 2023 will be delivered on Thursday 18 May, Finance Minister Grant Robertson announced today. More>> For example: There have been more protests by indigenous rural communities in Peru against a coup that’s been led by the wealthy urban elites; the West has pushed Iran even further into the arms of China; and Russia is unfurling a sneaky strategy that’s intended to create a whole new sphere of Kremlin influence in Africa. It stands for informing New Zealanders through straight-talking independent journalism, and publishing news from a huge range of sectors. This increase is likely to continue that trend as securing finance and debt servicing remain a barrier to purchasing ability. Rising interest rates directly impact affordability and we have seen slower buyer activity in the property market for some time.

Bank says it is too early to assess the monetary policy implications of Cyclone Gabrielle.

[“pause” rate hikes](https://www.stuff.co.nz/business/131258063/cyclone-gabrielle-will-adrian-orr-row-to-economys-rescue) and leave the OCR unchanged at 4.25% in the light of the economic shock expected from cyclone. The Reserve Bank’s monetary policy committee said it was too early to accurately assess the monetary policy implications of Cyclone Gabrielle “given that the scale of destruction and economic disruption are only now becoming evident”. It is still forecasting the OCR will peak at 5.5% later this year, but it does not now expect that peak to be reached until towards the end of the year. “The timing, size, and the nature of funding the Government’s fiscal response are also yet to be determined,” it noted. [a 50 basis point rate rise was most likely](https://www.stuff.co.nz/business/money/300812783/reserve-banks-tough-interest-rate-decision), with many warning that the damage caused by Cyclone Gabrielle would give fresh legs to inflation while also increasing the risk of a recession. The Reserve Bank has raised the official cash rate by 50 basis points to 4.75%, saying it is too early to assess the monetary-policy implications of Cyclone Gabrielle.

Today's double shot to the official cash rate means more pain is on the horizon for mortgagees. The onus is on Grant Robertson to pull back on the ...

That is what is needed to stop the pressure being heaped on Kiwi households.” “The responsibility is now the Government’s. “Today’s double shot to the official cash rate means more pain is on the horizon for mortgagees.

The Monetary Policy Committee today increased the Official Cash Rate (OCR) from 4.25% to 4.75%.

The Committee remains determined to achieve its Monetary Policy Remit. In time, the infrastructure and community rebuild will add to activity and inflationary pressures, especially given existing capacity constraints in the economy. The timing, size, and the nature of funding the Government’s fiscal response are also yet to be determined. It is too early to accurately assess the monetary policy implications of these weather events, given that the scale of destruction and economic disruption are only now becoming evident. Monetary policy is set with a medium-term focus, and the Committee will look through these short-term output variations and direct price effects. While there are early signs of price pressure easing, core consumer price inflation remains too high, employment is still beyond its maximum sustainable level, and near-term inflation expectations remain elevated.

The Reserve Bank has hiked the OCR up by 50 basis points to 4.75 percent. That's a total of 450 basis points since October 2021 and the Reserve Bank sees t.

- Publish Date - Wed, 22 Feb 2023, 8:29PM - Author

Reserve Bank Governor Adrian Orr told Breakfast that recent economic shocks have made it difficult to keep the OCR flat.

Orr expects it to be down at 5% by the end of this year and back to under 3% by the end of 2024. However, people who save will make more of those savings. It affects interest rates, which means those with credit card debt and mortgages will have to pay more interest.

Two bank economists think Wednesday's move on the base interest rate was the right one, and one they expected.

“It still sees upside risks to inflation in the near term. It flickered upwards by one fifth of one cent against the Greenback, before settling back down again. And the Government, banks and relief agencies will together be far more targeted (than the RBNZ) in getting needed support to those who need it.” Speaking to journalists after the announcement, Orr said the Monetary Policy Committee considered both a 50 point rise and a 75 point rise before settling on 50, but gave hardly any attention to a 25 point rise. In its paper, the RBNZ said the best thing monetary policy could do for the weather crisis would be to free up resources by slowing demand elsewhere in the economy with higher interest rates. The committee said it was too early to accurately assess the monetary policy implications of these storms, and further, the timing, size, and nature of the Government’s fiscal response was yet to be determined.