Reserve Bank will hike but not as much as it says

Economists say a slowdown will slow down the bank. RBNZ governor, Adrian Orr (pictured). (Image: Getty)

Wed, 25 May 2022

The Reserve Bank of New Zealand has signalled the official cash rate will be another 200 basis points higher in a year, but economists don’t think it will have to go that far.The Reserve Bank of NZ (RBNZ) lifted the official cash rate (OCR) by 50 basis points to 2.0% and now expects it to peak at 3.9% in June 2023, up from its February view that it would peak at 3.4% in Sept 2024.The OCR is now the highest it has been since September 2016. “A larger and earlier increase in the OCR reduces the risk of inflation becoming persiste...

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