Smaller hike as omicron, geopolitics and house prices keep RBNZ cautious

The key factor, however, is inflation. (Image: Getty)

Fri, 18 Feb 2022

Inflation is expected to spur a rate hike next week, despite omicron, jitters about a possible Russian invasion of Ukraine, and signs of a slowing housing market.While the market is toying with the idea of a 50-basis point rate hike to 1.25%, most economists expect it to opt for 25 basis points (bps).The rate hike would mark the third increase since it began lifting rates off record lows last October.“There is no serious debate about the fact that the New Zealand economy needs higher interest rates to rein in persistent inflation pressure...

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