RBNZ Expected to Hike OCR to 2.75% in September

The Reserve Bank of New Zealand (RBNZ) is expected to raise its Official Cash Rate (OCR) by 25 basis points to 2.75% at its upcoming September meeting, according to UOB Global Economics & Markets Research.

This change reflects persistent inflation at 4.1%, which remains above the RBNZ's target range of 1-3%. The bank has also expressed hawkish guidance, despite a soft labour market.

The RBNZ's shift towards pre-emptive tightening is seen as a continuation of its gradual normalisation process rather than the beginning of a more forceful hiking cycle.