The RBNZ raised the official cash rate (OCR) 25bps to 2.75%. It said fuel-driven
inflation in the quarter to June rose to 4.1%, while core inflation, expected
wage growth and inflation expectations remain consistent with inflation
returning to the 1–3% target range by mid-2027 and the 2% midpoint by late next
year. After weak growth in the June quarter, the economy has likely resumed an
uneven recovery the bank expects to strengthen and broaden. Global risks could
alter commodity prices and export demand; the recovery could be stronger or
weaker than expected and price pressures could cause inflation to persist
longer. The committee will remain vigilant and act if necessary to ensure
inflation returns to the 2% midpoint in the medium term. It gradually said
Withdrawal of policy stimulus is appropriate to return inflation to target while
supporting growth and employment, and that today’s decision lowers the risk that
further large rate hikes will be needed; future policy will depend on the
committee’s assessment of the balance of medium‑term inflation risks.
