Will the Reserve Bank’s 0.5% OCR cut have much impact on mortgage rates?
Tony Alexander discusses the Reserve Bank of New Zealand’s recent 0.5% cut to the Official Cash Rate, which has brought it down to 4.25%, while highlighting that the overall economic situation remains fragile with ongoing recessionary pressures and global trade challenges. Although there are signs of improvement in consumer sentiment and the real estate sector, the potential for significant reductions in mortgage rates—especially for longer terms—is limited due to persistent inflationary pressures abroad. Borrowers are advised to be cautious, as expectations for deeper interest rate cuts are fading.