Please help us keep it that way by allowing your browser to display NZ curve flattens; market sees a good chance of easier policy in the second half, when the economy is likely to be deeper in recession. We endeavour to ensure that the information on this site is current and accurate but you should confirm any information with the product or service provider and read the information they can provide. See what promotions banks are offering. 2020 remain unchanged. While there are positive signs that inflation is no longer increasing, it remains well above the Reserve Bank remit to keep inflation between 1% and 3% on average over the medium term. See how your lender responds to the cut. We may also receive compensation if you click on certain links posted on our site. Squirrel Mortgages has a Shopper Approved rating of 4.7/5 based on 1762 ratings and reviews. IMF downgrades forecasts. Nikko Asset Management head of equities Stu Williams speaks with Kate McVicar. Although inflation is coming down it continues to be unacceptably high around the globe. ASB has released its forecasts on the official cash rate (OCR) and mortgage rates ahead of the Reserve Bank of New Zealands (RBNZ) next announcement, quarterly Monetary Policy Statements (MPS), and six-monthly Financial Stability Reports (FSR). That may have a bigger impact on the housing market than what would be desirable, the bank said. We are an independent comparison platform and information service that aims to provide you with the tools you need to make better decisions. (Source: 1News). The Official Cash Rate, or OCR as it's usually referred to, was cut to just 0.25% in March 2020 - the lowest it's ever been. The Reserve Bank today announced the 2021 dates for +64 (0)9 307 1629, RBNZ expected to show some leniency in next OCR announcement, The RBNZ is set to deliver the announcement on Wednesday, with a mid-tier raise. On 6 October, the Reserve Bank of New Zealand (RBNZ) released its Monetary Policy Review, announcing an increase in the Official Cash Rate (OCR) from 0.25% to 0.5%. The RBNZ is set to deliver the announcement on Wednesday, with a mid-tier raise widely expected amongst analysts. Normally jumps to the OCR come in 0.25 basis point stages, though the central bank does make bigger moves pulling it down, such as a -1.50 basis point move during the height of the global financial crisis and -0.75 basis points at the start of the COVID-19 pandemic. day after the monetary policy announcement. Westpac Bank's latest report said that financial markets have been quick to anticipate the next phase of monetary policy and were pricing in cuts to the official cash rate (OCR) as early as the second half of 2023. arises with other important releases or events. Check your spending, adjust your budget and expenses where possible. Buying your first home, next home, investing in property or just keen to review your mortgage? Please complete the form below and click on SIGN UP to receive daily e-newsletters from. The release dates in full for the period until July 2022 are: Official Cash Rate announcements 24 February Achilles House credit card debit. Steps to owning and managing Credit Suisse Group, with 24-hour and historical pricing before you buy. If those advocating for a CGT and other redistributive tax measures may be compared to a revolutionary band hiding out in the mountains, then Parkers reports are the equivalent of a bloody great ammunition dump! Or, your browser is blocking ad display with its settings. The Reserve Bank is expected to hike the official cash rate (OCR) on Wednesday as New Zealand experiences the highest level of inflation in decades. media would be given as much notice as possible. It's predicted to rise by another 1.25% in 2023. The RBNZ will want to ensure they leave nothing on the table for their summer recess with the next OCR announcement not until February 22, 2023, Green said. Reserve Bank Governor Adrian Orr has lifted the official cash rate (OCR) by 50 basis points, to 4.75 per cent, despite billions of damage the economy faces after Cyclone Gabrielle. Please help us keep it that way by allowing your browser to display While it's difficult to pinpoint where inflation may fall during the first quarter of the year, which will take into account the Russian invasion, New Zealand's response to Omicron and continued supply chains issues impacting imports and exports, ANZ said it's largely a moot point. The 2021 The inflation outlook, while highly uncertain over the medium term, is worryingly high at present. If you are unsure you should get independent advice before you apply for any product or commit to any plan. Last Article Uploaded: Monday, May 1st, 6:45PM. Compare other variable-rate mortgages to make sure youre still getting the best deal. The RBNZ needs to be mindful of how quickly they went up as we navigate the impact of existing changes still washing through, Bolton said. After a period of much-needed respite over the holiday break, the RBNZ will be back to its regularly scheduled programming from late February. Only eight economists. US Treasury yields fall post CPI but then reverses much of that price action, NZ's largest bank raises fixed and floating home loan rates, savings account rates, and term deposit rates in a broad response to the recent RBNZ OCR rises, Mortgage rates were unmoved by the RBNZs big hike as traders bet any increase now will be matched with a cut later, US Treasury yields push higher, ahead of key CPI data tonight. And firms' pricing intentions, which have been the best inflation indicator of all, are stratospheric and at this point, still rising.". Analysts at CoreLogic said the outlook for interest rates remained stable for now, but borrowers may look to lock in longer-term rates, amid a growing expectation of higher interest rates in the next 18 months. Because your rate is fixed for an agreed period, a decision by the RBNZ to hold wont have as much of an effect on you depending on how long you still have to go in your fixed term. There are two types of OCR announcement over the course of the year. The 2021 release dates are: Monetary Policy Statement / Official Cash Rate announcements 24 February - OCR & MPS Media conference & live-stream 14 April - OCR 26 May - OCR & MPS. It's predicting a 50 basis point increase, which would be the largest increase to the OCR since May 2000. Only a significant drop in inflation would avoid an increase in the OCR. The RBNZ's assertive tightening to date is working, and the risk now is titled towards overtightening. Report 5 May - FSR Media conference & Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve. We are not a product issuer, credit provider or financial advisers nor are we a credit intermediary or broker. Compare accounts and ensure youre aware of whats on offer in the market. Term deposit rate increases are starting to filter through although they are limp new offers with banks falling further behind the OCR policy signals, Weaker US PPI inflation, higher jobless claims play to theme of weaker US economy and moderating inflation pressures, adding in expectations of just one more Fed rate hike, USD remains under pressure; US Treasury yields slightly higher, The banks are demonstrating that they won't hike interest rates just because the Reserve Bank would like them to - so it might be better for the RBNZ to adopt more of a waiting game, US CPI rises just 0.1% m/m; core up 0.4% - strong enough to maintain expectations for another likely Fed hike next month. We enable economic wellbeing and prosperity for all New Zealanders. It's the eighth consecutive time the Reserve Bank opted for a rates rise, and sixth increase in 2022 alone - February, April, May, July and August saw similar action. If this happens, you might want to compare the rates of high-interest savings accounts. Ask your lender for a rate discount so that if rates do rise you wont be worse off, or alternatively, compare other variable or even fixed-rate mortgages to find a better deal. If they dont pass on the full rate cut, ask for a rate discount, and if youre still not happy start comparing what other deals are in the market.If the rate holdsCompare other variable-rate mortgages to make sure youre still getting the best deal. "In regards to the property market, the prospect of a stable official cash rate for at least the next year or so suggests no major upwards pressure on mortgage rates until the second half of 2022 although of course global financial market shifts can have a significant influence too, as well as upside inflation surprises within NZ. A move by the Reserve Bank of New Zealand to raise the official cash rate by 0.75% would be a step too far, according to some mortgage advisers. We may receive compensation from our partners for placement of their products or services. ASB is forecasting three rises to the official cash rate (OCR) this year, saying it's time for rates to start moving. Subscribe to our newsletter to ensure you're the first to get the latest articles and insights from the Squirrel team. This supported US Treasuries, with US 10-year rate down 10bps to 3.42%. Should the Government 'force banks to provide it with interest-free loans' to recoup some RBNZ QE losses? JGBs rally, BNZ chief economist Mike Jones thinks the RBNZ has made progress bringing the runaway economy back under control, Auckland University's Tim Hazledine offers a range of suggestions to help the Reserve Bank fight inflation, Global rates lower after their recent rise; Treasury yields down 5-7bps, German 10-year rate falls for first time in over two weeks. Create a SUPPORTER account with no ads Our daily newsletter is FREE and keeps you up to date with the world of mortgage. Banks website at least one year in Still, there are signs of a tentative shift in tone," the group's economists said. ANZ is forecasting it could reach 7.4 percent in the second quarter of the year. The Reserve Bank will make an announcement on the official cash rate today with many economists expecting it to jump up to 50 basis points to 3%. USD broadly stronger. But while any increase in interest rates is good news for savers, the rates for term deposits and savings accounts are still lower than what most people think of as normal, and we expect rates to remain low when compared to the average levels over the past 10-15 years. Today's announcement has prompted Kiwibank economists to move forward their prediction for OCR hikes to May 2022. Just when we thought the 'shock' had gone out of Orr RBNZ lifts the OCR to 5.25% in surprise move to combat cyclone inflation. The latest quarterly inflation stats last month didn't exactly deliver the news the market (or anyone to be honest) was hoping for - with inflation tracking at 7.2%, as opposed to the 6.5% that was anticipated. In return, we'll give your team access to pro news tools and keep Scoop free for personal use, because we believe public access to news is important! There are two types of OCR announcement over the course of the year. conflicts with other important releases or events. ANZ's Business Outlook in March found inflation could be "moon-bound" given that nearly all surveyed businesses expected higher costs in the coming months, which flows on to increases in prices for consumers. My advice for potential first home buyers is dont fear higher interest rates as you will be borrowing less than the market at its peak., Read more: Reserve Bank makes its September rate call. They said while New Zealand has had to tighten its purse strings, through increased interest rates, the domestic economy is in a good position to weather the global financial situation. Inflation is now back above 3%, and we expect it to press higher over late 2021/early 2022. ASB economists latest OCR forecast also suggests that mortgage interest rates are likely to settle at historically low levels, but slightly higher than the economists previous forecasts. which includes some flexibility to shift the date in case of The current situation in New Zealand is no exception. Find out more, TradeMe: Rents Soar For Small PropertiesTrade Me Property Sales Director Gavin Lloyd said the March 2023 figures show rents for apartments and small houses (1-2 bedroom) were soaring More>>, Seafood NZ: Welcomes Draft Industry Transformation PlanSeafood New Zealand Chief Executive Dr Jeremy Helson says the fishing industry shares the Governments vision of improving the environmental performance of commercial fisheries More>>, Reserve Bank: Proposes To Ease LVR RestrictionsThe Reserve Bank of New Zealand Te Ptea Matua is proposing to ease mortgage loan-to-value ratio (LVR) restrictions. ASB, ANZ, and BNZ also released their forecasts - expecting the OCR to reach 0.5% next month, according to Stuff.. ASB chief economist Nick Tuffley said the RBNZ had "clearly changed tack . But 2021 has been a turning point. Financial Stability Reports (FSR). What will this mean for you? Published date: 16 February 2023 Last modified date: 22 February 2023 Timeline of our OCR announcements since November 1999 See our chart of OCR announcements Official Cash Rate (OCR) (updated at end of month) Chart Summary Privacy Policy, Mark your calendars: Key OCR dates for 2023, sense across the market is that it wont need to get that far. Squirrel Mortgages has a Shopper Approved rating of 4.7/5 based on 1762 ratings and reviews. The release dates for KiwiSaver and investment funds providers offer a range of choices to investors. NZD re-tests sub-0.62 level, NZIER's Christina Leung explains how higher interest rates are impacting New Zealand businesses and why profits aren't driving inflation, BNZ's head of research says the RBNZ should have opted for a smaller Official Cash Rate rise and caution that further rate rises might be needed; approach taken 'will most definitely generate heightened volatility', Weaker US ADP employment and services ISM data push US Treasury yields lower. Both ASB and ANZ believe the OCR will begin to rise from August 2022. Get two weeks free access to NBRs Premium Online Subscription, which includes full access to all of NBRs great content on any device. We recommend seeking professional investment and/or mortgage advice before taking any action. Both ASB and ANZ believe the OCR will begin to rise from August 2022. It's a big day for economic news as the Reserve Bank (RBNZ) gets set to announce the official cash rate (OCR) and Treasury opens the government's books, releasing the Crown accounts for the. L3, Suite 301, If rates rise, savings accounts rates could increase as well. Market Credits: Video - Newshub; Image- Getty Images. We may also receive compensation if you click on certain links posted on our site. Please appreciate that there may be other options available to you than the products, providers or services covered by our service. The biggest impact on borrowers may be behind the scenes if banks increase servicing test rates further and this will offset benefits from falling house prices by limiting lending capacity., Our daily newsletter is FREE and keeps you up to date with the world of mortgage. The ASB team added: "We were a little surprised to see the bank be so forthcoming, with the publishing of an OCR track signalling rate hikes, an acknowledgement that the OCR cannot remain at emergency levels forever. Official Cash Rate (OCR) decisions, and the six-monthly I believe the RBNZ will hike in February and April, and then pause. Related to this, when interest rates change, it can lead to volatility (ups and downs) in sharemarkets and property markets. "A further 25 point nudge in the cash rate, accompanied by a stern warning that a more aggressive interest rate track will likely be forthcoming, when it releases its May Monetary Policy Statement, might be a better approach.". And borrowers can lock in incredibly low long-term interest rates (around 3% to 3.7%) now if interest rate certainty over a longer period is of the utmost importance, the ASB economists wrote on the report. Skip ahead to read the latest analysis, see how the OCR has changed over time and learn more about how the official cash rate affects you. Sign up to get all the latest articles direct to your inbox. You can also search our past events. live-stream 14 July - OCR Remaining release On 6 October, the Reserve Bank of New Zealand (RBNZ) released its Monetary Policy Review, announcing an increase in the Official Cash Rate (OCR) from 0.25% to 0.5%. The economy also experienced more than expected consumer spending during summer holidays. A move to 3% today would be a seven year high. The New Zealand dollar jumped more than half a US cent, breaking through US$0.70 within minutes of the announcement. MPS/OCR review dates will shift to, The Reserve Bank reserves the right to make changes to this schedule, if required. When it is adjusted, it is usually done in 0.25% increments, as we saw this month. As a result, rates dropped to their lowest level on record, going back to the 1960s. Borrowers will be pleased to know we still expect mortgage interest rates to eventually settle over the next decade at levels well below the long-run averages of the past 20 years. OCR BNZ sees signs of the economy rebalancing 28th Apr 23, 12:36pm by Dan Brunskill 28 BNZ chief economist Mike Jones thinks the RBNZ has made progress bringing the runaway economy back under control Tim Hazledine on potential new tools to help with the inflation fight One of the biggest challenges for people is the inflation rate. The growth assets like property and shares are influenced by the broad economic backdrop and that includes interest rates. "This should help mitigate immediate financial market reaction from 'just' a 25bp move and largely sustain the tightening in financial conditions that the RBNZ has already engineered. The Reserve Bank has double-pumped the Official Cash Rate with its surprise 50 basis point hike in an effort to blindside the markets. Advice HQ founder and financial adviser David Green (pictured above right), said the RBNZ remained in catch-up mode as high inflation stayed in play, as confirmed by recent releases on unemployment rates and wage growth. There is probably still just a bit more work to do on tightening monetary policy. Join Scoop Pro
When the RBNZ gets closer to actually changing the OCR setting, the upward pressure will come on the shorter terms and floating rates too.. + Read Dr Oliver Hartwich's full forecast. Sign up to our free email newsletters here. On the other hand, the wall of inflation is vertical and so far, completely unyielding. "Normally, near-term downside growth risks are a recipe for at least caution on the part of central banks, if not outright largesse. Kate McVicar Mon, 20 Feb 2023. What will this mean for you? But occasionally the RBNZ makes larger adjustments. releasing its quarterly Monetary Policy Statements (MPS), Reuters surveyed 23 economists ahead of the RBNZs Wednesdays cash rate announcement, with more than 60% expecting a 75 basis-point hike, taking the OCR to 4.25%. Usually fourth Wednesday in February, May, The OCR has been steadily increasing since October last year in an ongoing bid to tackle inflation of 7.3%. In such an event, the markets and the ", 'Not going away': Kiwis need tighter budgets as retailers plan price increases - economist, Copyright 2023 Discovery NZ Limited (Warner Bros. The Taylor Rule OCR would be around 8%, which suggests that there is room for some OCR increases over the coming months. China credit growth strong, US Treasury yields higher after solid non-farm payrolls report; other labour market data show clearer weaker trends. Speaking A Tonal Language Could Boost Your Melodic Ability, But At The Cost Of R New Report Examines Aucklands Globally Focused Technology Industry. The current forecast says the Official Cash Rate (OCR) could peak as high as 5.5% as the RBNZ continues its battle against rampant inflation, which would mean weve got another 1.25% to climb from the current level. Financial Stability They will be Kiwi homeowners should brace for yet another increase to the cash rate, according to this months Finder RBNZ Official Cash Rate Survey. The hardest thing in the world to understand is the income tax. RBA opts for a pause, Higher oil prices drive global rates higher but reversal follows after weak US ISM manufacturing report; net change in yields is lower. Analysts at CoreLogic said the outlook for interest rates remained stable for now, but borrowers may look to lock in longer-term rates, amid a growing expectation of higher interest rates in the next 18 months. We expect inflation will be much higher over the next five years than it has been over the past five years. In its October review, the RBNZ did what we expected it would do: increase the OCR by 0.25%. It will of course be much more than passing interest to see what it is forecasting in its next MPS to be released on August 17 - and whether it will now see a higher peak. Read More Major banks do U-turn, now expect no change in OCR - NZ Herald "Next Wednesday looms as one of its more eagerly awaited OCR decisions. See more of ASBs latest financial news and announcements here on our blog. credit card debit, $25 per user - Pay by monthly Bond traders are betting against the Reserve Bank, NZD shows notable underperformance, weaker on all the crosses, RBNZ's shock 50bps hike has back-fired; NZ rates mainly lower as market prices in eventual policy reversal, Of Interest Podcast: Profits not responsible for inflation, NZIER economist says, BNZ's Toplis: There was no need for the RBNZ to 'go like a bull at a gate', USD well supported on safe haven flows; NZD/USD fully reverses. Core inflation is far too high. We noticed that you're using an ad blocker. These two factors signal the need to continue applying contractionary monetary policy. There was even talk of it going into the totally uncharted territory of a negative rate, as we have seen in Europe and Japan. Events calendar. With earnings season in full swing, it might be easy to forget the Reserve Bankis also scheduled to make the first official cash rate (OCR) announcement of the new year this week. A timeline of our past monetary policy and Official Cash Rate (OCR) announcements. "The Reserve Bank is between something of a rock and a hard place," ANZ said in its report. The low interest rates both here and abroad have been very positive for shares and property over recent years, including the past 12 months. While we receive compensation when you click links to partners, they do not influence our content. If your fixed-rate mortgage is to end soon, start comparing what deals are on offer, so you dont find yourself scrambling to lock in another rate.If the rate gets cutIf you feel your mortgage is no longer competitive, you might want to obtain a quote from your lender to find out possible exit costs. "The data that we have had suggests that near-term inflation is a growing headache for businesses and households. We asked our panel of experts to have their say on New Zealands property market, the possible extension of the travel bubble, and more. Last month Stats NZ announced that food prices rose 6.6% on last year. below. website. I think enough is done already as inflation will begin to ease. I then expect the RBNZ to be in a position to ease policy as early as November this year. Meanwhile, ASB is forecasting a more cautious 25 basis point jump, but isn't ruling out the possibility of a larger increase. OCR announcement dates for 2023 After a period of much-needed respite over the holiday break, the RBNZ will be back to its regularly scheduled programming from late February.