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New Zealand Interest Rate

New Zealand Interest Rate

Official Cash Rate in New Zealand

The Official Cash Rate (%, eop) ended 2024 at 4.25%, down from the 5.50% end-2024 value and up from the reading of 3.50% a decade earlier. For reference, the average interest rate in was % at end-2024. For more information on interest rate, visit our dedicated page.

New Zealand Interest Rate Chart

Note: This chart displays Policy Interest Rate (%) for New Zealand from 2025 to 2014.
Source: Macrobond.

New Zealand Interest Rate Data

2020 2021 2022 2023 2024
Official Cash Rate (%, eop) 0.25 0.75 4.25 5.50 4.25
90-Day Bank Bill (%, eop) 0.26 0.91 4.53 5.63 4.27
10-Year Bond Yield (%, eop) 0.99 2.38 4.47 4.37 4.52

Central Bank cuts rates in October

Latest bank decision: At its meeting on 8 October, the Central Bank decided to cut the Official Cash Rate (OCR) by 50 basis points to 2.50%, taking total rate cuts to 300 basis points since August 2024.

Tepid economy and mild inflation expectations drive cut: The decision was influenced by the tepid domestic economy, with the Bank highlighting flat house prices and weak investment. Moreover, inflation is expected by the Bank to fall back towards the center of the 1.0–3.0% target range early next year.

Further rate cuts on the cards: The Bank suggested it could cut rates further going forward in order to stabilize inflation close to the center of the target range.

Panelist insight: Goldman Sachs analysts said: “Looking ahead, we see a strong case for unambiguously accommodative policy settings in New Zealand to ensure the above-trend recovery necessary to close a now large negative output gap (at around -1.75% of GDP). We now forecast a deeper RBNZ easing cycle with 25bp OCR cuts in both November and February down to a terminal rate of 2.00% (prior: 25bp cut in Nov to 2.25%).” ANZ Bank analysts said: “We are forecasting a follow-up 25bp cut in November taking the OCR to 2.25%, with that to mark the end of the easing cycle. We see risks on both sides of that. If the data continues to disappoint, another 50bp cut is possible. But it’s entirely possible that activity data will start to surprise to the upside from here – the bar for that is low.”

Consensus Forecasts and Projections for the next ten years

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects New Zealand interest rate projections for the next ten years from a panel of 10 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for New Zealand interest rate.

Download one of our sample reports to visualize what a Consensus Forecast is and see our New Zealand interest rate projections.

Want to get access to the full dataset of New Zealand interest rate forecasts? Send an email to info@focus-economics.com.

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