About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Saturday, May 25th, 2:10AM
rss
Latest Headlines

OCR cut to 1.5%: could it fall even further?

The Reserve Bank has cut the Official Cash Rate to 1.50%, and economists believe we could see a further cut later this year.

Wednesday, May 8th 2019, 2:19PM

Adrian Orr

The central bank's Monetary Policy Committee, led by Adrian Orr, (pictured), has taken the step of easing the OCR amid weak inflation, concerns about future employment, and a slowdown in global economic growth. Economists believe we may see a further cut if the 25 basis point reduction is "not effective".

Jarrod Kerr, chief economist at Kiwibank, told TMM the RBNZ MPC had "done what was expected" amid weak economic indicators. He believes it will not be the only action taken on the OCR this year. "We are in the camp that believe another cut may be required in order to have a meaningful impact. One step has been taken today and we expect another later in the year."

Yet Nick Tuffley, chief economist at ASB, told TMM pointed out there appeared to be "no urgency" to cut the OCR again this year. "The OCR outlook appears more balanced. The Reserve Bank will be judicious about another cut, rather than rushing into it." Like Kerr, Tuffley expects a further fall this year. 

The OCR cut, and prospect of a further fall, will be welcomed by borrowers, who look set to enter an unprecedented period of low interest rates. "This great news for borrowers, and bad news for savers," said Kerr. "Other winners are exporters, as the Kiwi [currency] takes a hit."

Independent economist Michael Reddell welcomed the decision, and pointed to the central bank's inflation targets. "They still only think inflation will be back to 2% two years from now, on growth projections that themselves look optimistic."

NZIER's Christina Leung was surprised the bank acted so early, and also believes there will be another cut in this cycle, but that it could be a few years away.  She added: "Given its dovish rhetoric, we expect on balance the Reserve Bank will follow up with another cut over the coming years.

 

Tags: ASB Kiwibank RBNZ Reserve Bank

« OCR decision revealedAdvisers react to new Code »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News
Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.69 4.39 4.45 4.55
ANZ Special - 3.89 3.95 4.05
ASB Bank 5.70 4.45 4.39 4.55
ASB Bank Special - 3.95 3.89 4.05
BNZ - Classic - 3.89 3.95 ▼3.89
BNZ - Mortgage One 6.40 - - -
BNZ - Rapid Repay 5.85 - - -
BNZ - Std, FlyBuys 5.80 4.69 4.59 4.79
BNZ - TotalMoney 5.80 - - -
Credit Union Auckland 5.95 - - -
Credit Union Baywide 6.15 5.20 5.25 -
Lender Flt 1yr 2yr 3yr
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 - - -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 ▼4.60 ▼4.75 -
Housing NZ Corp 5.80 4.69 4.49 4.45
HSBC Premier 5.89 3.99 3.99 4.39
HSBC Premier LVR > 80% - - - -
HSBC Special - 3.69 3.69 3.95
Lender Flt 1yr 2yr 3yr
ICBC 5.79 3.95 3.99 3.95
Kiwibank 5.80 4.80 4.94 4.84
Kiwibank - Capped - - - -
Kiwibank - Offset 5.65 - - -
Kiwibank Special - 4.05 3.99 4.09
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 6.10 4.89 4.99 -
Resimac 5.30 4.86 4.46 4.69
RESIMAC Special - - - -
SBS Bank 5.79 4.85 5.05 5.49
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 3.99 3.99 3.99
Sovereign 5.80 4.45 4.39 4.55
Sovereign Special - 3.95 3.89 4.05
The Co-operative Bank - Owner Occ 5.65 3.99 3.99 4.15
The Co-operative Bank - Standard 5.65 4.49 4.49 4.65
TSB Bank 5.69 4.55 4.49 4.65
TSB Special - 4.05 3.99 4.15
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.79 4.69 4.79 5.19
Westpac - Offset 5.79 - - -
Westpac Special - 3.89 3.95 3.95
Median 5.80 4.45 4.42 4.42

Last updated: 23 May 2019 12:07pm

News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com