NZ central bank hikes rates by 50bps, as expected, flags more to come

WELLINGTON  – New Zealand’s central bank raised interest rates by 50 basis points to a more than 14-year high of 4.75 percent on Wednesday, and said it expects to keep tightening further to ensure inflation returns to within its target range over the medium term.

Twenty of 25 economists in a Reuters poll forecast the Reserve Bank of New Zealand (RBNZ) would move by 50 basis points, the tenth straight hike since it began tightening in October 2021.

It continues to expect the cash rate to peak at 5.5 percent in 2023, according to the monetary policy statement (MPS).