The 25 basis points rise in the Official Cash Rate to 2.75% announced by the Reserve Bank of New Zealand today was widely expected said the New Zealand Bankers’ Association.
“The OCR rise has been clearly signalled by the Reserve Bank Governor for some time, and comes as no surprise,” said New Zealand Bankers’ Association chief executive Kirk Hope.
The OCR is part of a range of factors that drive interest rate changes. Other important factors that influence rate changes include the cost of funding from domestic deposits and the cost overseas wholesale funding.
“It’s a good time for mortgagors to assess their circumstances to help ensure they can manage an increase in the cost of borrowing.
“This is especially important for first-home owners who have borrowed at historically low rates.
“Talk to your bank about your particular circumstances. Banks are happy to provide information about products and services to suit individual needs.”
Hope added that the gradual rise in interest rates was good news for people with savings in the bank, especially those who relied on interest income from investments such as retirees.