New Zealand’s central bank delivered its third consecutive rate hike on Thursday, and it’s likely to make that four in a row judging by hawkish comments, some analysts say.
The Reserve Bank of New Zealand (RBNZ) lifted its key interest rate by 25 basis points to 3.25 percent. While that move was not a surprise, analysts had expected the central bank to suggest a slowdown in the pace of monetary tightening.
Instead policy makers said further rate increases would be needed to curb inflation in a robust economy.
“Effectively, the RBNZ is a lot more focused on domestic mortgage rates. There’s been a lot of competition in the domestic mortgage market in New Zealand which has been pushing rates down,” said Robert Rennie, the global head of foreign exchange strategy at Westpac Bank in Sydney.
“The RBNZ is unhappy with that and there is a risk that we see another rate hike in July, which would make it four in a row,” he added.