RBNZ Seen Hiking but Staying Gradual

TD Securities analysts Prashant Newnaha and Howard Du predict that the Reserve Bank of New Zealand (RBNZ) will raise the Official Cash Rate by 25 bps to 2.75% in September, aligning with market pricing.

The RBNZ's Monetary Policy Committee is expected to come to this decision unanimously, with data supporting a hike and little reason for the Board to pause.

Looking ahead, the analysts see the OCR track remaining broadly unchanged from May, reaching 3% by year-end and around 3.30% terminal, with further 25 bps hikes projected in December 2026 and February 2027.