New Zealand interest rates
The Official Cash Rate (OCR) is New Zealand's base interest rate, set by the Reserve Bank of New Zealand (RBNZ). When it moves, mortgage rates, savings rates and business lending all follow, usually within weeks.
On a $500k, 30-year mortgage that's about $2,962 a month, vs $2,234 at the Apr 2021 low of 3.46%. Work out your own repayments
OCR vs inflation, 2015–present
The Reserve Bank raises the OCR when inflation threatens the 1–3% target band, and cuts when the economy needs support.
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The Reserve Bank raises the OCR to cool inflation and cuts it to support growth. Watch for the OCR line moving a few months after inflation changes direction. The dashed mortgage line lags the OCR too, since banks price fixed loans off their own funding costs, not the OCR directly. Inflation expectations (from the Reserve Bank's own quarterly survey of businesses and forecasters) matter because expected inflation tends to become actual inflation - it's a leading indicator the Bank watches closely. COVID-19 pushed the OCR to a record low; the Ukraine war's oil and food price shock is a big part of why inflation and the OCR both spiked afterward. The dashed band is the 1-3% target for the CPI line specifically, not for the OCR, mortgage rate or expectations.
The OCR is currently 2.75%. That's down from a peak of 8.25% and above the low of 0.25% seen over this period. The 2-year mortgage rate sits at 5.89%, well above the OCR itself.
The OCR should sit at whatever level keeps CPI inflation inside the Reserve Bank's 1–3% band - rising when inflation threatens to break above it, falling when the economy needs support and inflation has room to spare. It's a lever, not a destination: there's no 'good' number for the OCR on its own, only whether it's currently doing that job.
The wider rate environment
Government bond yields and term deposit rates track, and often lead, the OCR.
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Bond and term-deposit rates often move before the OCR does, because they reflect what markets expect the Reserve Bank to do next, not just what it has already done.
Right now the OCR is 2.75%, the 10-year government bond yields 4.71%, and 6-month term deposits pay 3.53%. Longer-term rates sitting above the OCR suggests markets expect rates to stay elevated for a while yet.
Bond and term-deposit rates should track a bit above the OCR and stay reasonably stable - big, sudden moves in either direction signal markets bracing for a shock, not steady policy. Falling rates favour borrowers and growth; rising rates favour savers and cool inflation, so which direction is 'better' depends entirely on where inflation sits at the time.
Where are New Zealand interest rates heading?
This site doesn't forecast interest rates. The Reserve Bank publishes its own projected path for the OCR in each Monetary Policy Statement. What the live data here can show is the pressure the Bank is weighing when it decides.
Where the OCR sits now
It has been at this level since Sep 2026, when the Reserve Bank raised it from 2.50%.
As of Sep 2026
Inflation vs the 1-3% target
Above the 1-3% band the Reserve Bank must aim for - the kind of reading that holds it back from cutting.
As of Sep 2026
Where inflation is expected to be
Businesses and forecasters expect inflation two years out to sit above the 2% midpoint the Bank aims for. The Bank watches this closely, because expected inflation tends to feed into wages and prices.
As of Sep 2026
These are some of the inputs the Reserve Bank's Monetary Policy Committee weighs at each review, alongside jobs, growth and global conditions - so no single signal decides the next move.
What this means
- Banks don't lend at the OCR: they lend at a margin above their own funding costs. Fixed mortgage rates follow wholesale swap rates, which is why they sometimes move before the OCR does.
- Each 1 percentage point change in a mortgage rate shifts the monthly repayment on a $500k, 30-year loan by roughly $300–330.
- When the OCR rises, mortgage holders feel it as their fixed terms roll over: the pain arrives in waves over 12–24 months, not all at once.
Every figure on this page (the Official Cash Rate, 2-year fixed mortgage rate, 10-year government bond yield, 6-month term deposit rate and 2-year inflation expectations) is live, verified through a manually-entered, audited fallback while automated RBNZ access is pending.