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'At the Early Stages of a Recovery': Reserve Bank Keeps OCR on Hold
New governor Anna Breman prioritizes inflation control while supporting fragile recovery; 75% of surveyed clients expect one rate hike by year-end, Westpac said.
- Reserve Bank governor Anna Breman chaired her debut meeting on Feb 18 and kept the official cash rate at 2.25%, with forecasts pointing to a rise early next year.
- Balancing inflation control with recovery support guided the decision as the Reserve Bank of New Zealand kept the OCR on hold to address 3.1% inflation last year amid weak unemployment.
- Survey data and swap-rate moves signalled market bets on hikes as a Westpac survey showed 75% expected one hike to 2.5% this year, with two-year swap rates rising and the Kiwi dollar falling from US60.45c to US60.15c.
- Borrowers face immediate consequences as guidance points to eventual tightening; mortgage-holders were disappointed, though lower retail interest rates have eased household budgets after nine of the previous 10 meetings were cuts.
- The MPC projects inflation will return to midpoint within a year, but analysts remain split with some expecting hikes this year and others forecasting 2027, as ASB sees a gradual path to a 3.25% peak.
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New Zealand’s Anna Breman chairs first central bank meeting as rate hike chatter grows
WELLINGTON, Feb 18 (Reuters) – New Zealand’s first female central bank chief Anna Breman chairs her debut meeting on Wednesday, with rates widely expected to stay on hold, but markets will zero in on its rate projections for any hints of a hike this year. The Reserve Bank of New Zealand is widely tipped to keep its benchmark official cash rate unchanged at 2.25% as the economy slowly pulls out of a slump caused by punishing policy tightening s…
Coverage Details
Total News Sources11
Leaning Left2Leaning Right0Center4Last UpdatedBias Distribution67% Center
Bias Distribution
- 67% of the sources are Center
67% Center
L 33%
C 67%
Factuality
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