Westpac Sees Consensus RBNZ Hike, Modest Risks Around Base Case

Westpac's chief economist Kelly Eckhold expects the Reserve Bank of New Zealand (RBNZ) to raise its Official Cash Rate by 25 basis points to 2.75% at its Monetary Policy Statement on September 2.

This decision is seen as a straightforward and consensus move, with only a 10-15% probability of a hawkish surprise or a dovish surprise suggesting a pause through December.

The RBNZ's projections are likely to continue implying a 3% OCR by year end, matching the May MPS, with the rate track beyond 2026 expected to stay close to the May profile, which had the OCR peaking at around 3.3%.