OCR Hike and Methanex Plant Closure Send Shocks Through NZ Economy

The Reserve Bank of New Zealand has increased its official cash rate to 2.75%, marking the second hike this year. The decision follows a 25-basis-point increase in July, which was the first rate rise in over three years.

The central bank's Monetary Policy Committee agreed that the current projection for the OCR is appropriate, but noted that further raises are likely.

Methanex, the country's largest gas user, has announced it will close its Taranaki plant due to a decline in natural gas supply. The plant, which has been operational for over three decades, will cease methanol manufacturing at the end of February 2027.

The closure is expected to have significant implications for New Zealand's energy sector and economy.