RBNZ raised the OCR by 25bps to 2.75%, as expected, while the Committee judges that gradually removing monetary stimulus is appropriate to return inflation to the 2% target mid-point while supporting growth and employment

Statement Sees Official Cash Rate at 2.81% in December 2026 (prev. 2.84%). Sees Official Cash Rate at 3.12% in September 2027 (prev. 3.11%). Sees Official Cash Rate at 3.15% in December 2027 (prev. 3.15%). Sees Official Cash Rate at 3.28% in September 2029. Sees TWI NZD at around 66.9% in September 2027 (prev. 66.6%). Sees annual CPI at 2.4% by September 2027 (prev. 2.0%). The decision reduces the risk that the OCR needs to increase by more later. Future policy decisions will depend on the Committee’s judgement of the balance of risks to medium-term inflation. New Zealand’s economic recovery has most likely resumed but remains uneven. Recovery is expected to strengthen and broaden. Committee remains vigilant and will respond as necessary to ensure inflation returns sustainably to the 2% target mid-point over the medium term. Committee expects New Zealand’s export sector to remain resilient and household spending to gradually increase. Conditions in the labour market should improve. RBNZ Minutes Monetary Policy Committee reached consensus to increase the OCR by 25bps to 2.75%. After lacklustre growth in the June quarter, the economic recovery has most likely resumed but remains uneven. Future policy will depend on the Committee’s judgement of the balance of risks to medium-term inflation. Recovery is expected to strengthen and broaden. Conditions in the labour market should improve as the recovery gathers pace. Committee judged that increasing the OCR to 2.75% is appropriate to sustainably return inflation to the 2% target mid-point. Future OCR path is not pre-determined. Indicators of medium-term inflation are consistent with inflation returning to target. All members agreed that the central projection for the OCR is appropriate. All members agreed that downside risks to activity were significant and the recovery could remain uneven. Conditional on the central economic outlook, members judged that the OCR may need to increase further. On balance, the Committee assessed that spare capacity remains in the economy, particularly in the labour market. Hayley Gourley, Karen Silk, Prasanna Gai and Anna Breman saw upside risks to inflation relative to the central projection. Paul Conway and Carl Hansen saw risks to inflation as balanced.