Emergency OCR cut: economists give their views

The OCR will remain at 0.25% for at least 12 months, as the government and central bank attempt to get to grips with the Covid-19 crisis.

ASB economists said the central bank's move puts the OCR at the same lower limit identified by Australia.

The RBNZ indicated 0.25% is likely to be the lower limit for this cycle, stating a "large scale asset purchase programme of New Zealand government bonds would be preferable to further OCR reductions".

ASB chief economist Nick Tuffley said the rate cut and commitment to keeping rates steady for 12 months "should help to suppress long-term interest rates".