Buying guide
When is the next OCR announcement in NZ?
The Official Cash Rate can affect your interest rates so it’s always good to know when it may change.
Last updated: 5 November 2024
When the Official Cash Rate (OCR) changes, mortgage interest rates generally change too. That’s not all it affects, though – the OCR can influence the price of everyday items, the housing market, the job market and much more. Needless to say, it's a fairly important number.
That’s why it’s always good to know what the OCR is, how it works and when the next OCR announcement will be.
The 2025 OCR announcement dates
The OCR is reviewed seven times a year then an announcement is made detailing the decision and the reasons behind it. The Reserve Bank of New Zealand (RBNZ) has scheduled its Official Cash Rate (OCR) announcements for 2025 as follows:
- February 19, 2025 – Monetary Policy Statement
- April 9, 2025 – Monetary Policy Review
- May 28, 2025 – Monetary Policy Statement
- July 9, 2025 – Monetary Policy Review
- August 20, 2025 – Monetary Policy Statement
- October 8, 2025 – Monetary Policy Review
- November 26, 2025 – Monetary Policy Statement
Keep in mind that just because there is an announcement, doesn’t mean that the OCR will increase or decrease. For example, in 2023, the OCR stayed the same all year after increasing in May.
What is the OCR?
Think of the Official Cash Rate (OCR) as New Zealand’s "economy dial." It’s a rate set by the Reserve Bank that influences interest rates across the board, affecting everything from mortgages to personal loans.
Here’s how it works in a nutshell:
When the OCR goes up: It’s like turning down the heat on the economy. Banks raise their interest rates, so loans and mortgages cost more. People with debt end up paying more on their repayments, which means they’ve got a little less to spend on other things. This tends to slow down spending, which (in theory!) helps cool down inflation and bring prices down.
When the OCR goes down: It’s like giving the economy a little boost! With lower rates, loans are cheaper, which encourages people to borrow and spend a bit more. This can give demand — and sometimes prices — a nudge upward.
So, the OCR is the Reserve Bank’s way of trying to keep prices steady and inflation in check by adjusting how much it costs to borrow money. It’s a bit like tuning a car engine, keeping it running smoothly without overheating.
Dig deeper into how the OCR works.
The Reserve Bank is a government owned entity that sets interest rates.
What is the OCR forecast for 2025?
When it comes to the OCR in New Zealand for 2025, predictions from local economists and banks are leaning towards a continued gradual reduction.
As for the level the OCR might eventually settle at, most banks think it'll hover around the "neutral" level of 2.75%, where the economy isn’t being overly stimulated or constrained. The hope is that lowering rates too quickly won’t spark a resurgence of inflation
So, what does all this mean for you? Expect interest rates to move downward in 2025. But given the unpredictable nature of the global economy, particularly around inflation and any potential economic shocks, those cuts might be smaller and slower than some are hoping for.
*We hope this article has provided some helpful information. It's based on our experience and is not intended as a complete guide or as financial advice. Of course, it doesn’t consider your individual needs or situation. If you’re considering buying home insurance, make sure to do your due diligence, and speak with a professional if necessary.
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