OCR Hike Forecast as Bond Yields Soar

Westpac Chief Economist Kelly Eckhold expects interest rates to rise due to inflation concerns. The OCR (Official Cash Rate) has already increased to 2.75 percent, and bond yields are rising internationally. Ten-year New Zealand government bonds are now paying above five percent, the highest level since 2023.

US 30-year Treasury bonds have reached their highest point since 2007. Eckhold predicts that the OCR could be four percent by the end of next year as central banks face significant challenges in 2027.

The expectation is that interest rates will continue to increase, putting pressure on borrowers and savers alike.