The Reserve Bank’s Monetary Policy Committee (MPC) kept the official cash rate (OCR) at 2.25% on Wednesday in Wellington, as expected by all 22 economists surveyed by Bloomberg. “However, any signs of significant second-round inflationary effects or increases in medium-term inflation expectations would require decisive and timely increases in the OCR to re-anchor inflation expectations. With fuel costs soaring in response to the Middle East conflict, policymakers are sensitive to price- and wage-setting behaviour that could drive so-called second round effects and unmoor inflation expectations. Spare capacity“If medium-term inflation expectations increase, then inflation is likely to become more persistent,” the MPC said. Inflation is likely to accelerate to 4.2% in the second quarter, the RBNZ said, adding there are “significant uncertainties” around that forecast.

Source: The Edge Markets April 08, 2026 03:02 UTC