Reserve Bank of New Zealand delivers unanimous 25 bps hike, signaling further tightening as inflation remains above target.
The Reserve Bank of New Zealand increased its Official Cash Rate by 25 basis points to 2.50%, a unanimous decision that contrasted with May’s split vote. The move reflects persistent inflation concerns, with the RBNZ describing current policy as still accommodative and indicating further stimulus reduction is likely.
In May, the RBNZ’s decision to hold rates was narrowly split 3-3. The latest hike aligns with projections showing inflation peaking at 3.9% in the second quarter of 2026 before easing toward the 2% midpoint of its 1-3% target range by mid-2027. Global oil price declines have balanced inflation risks for most committee members.
NZD/USD rose above 0.57 following the announcement, supported by the RBNZ’s hawkish stance and renewed confidence in its inflation-fighting resolve.