Reserve Bank of New Zealand Interest Rate Decision

The Reserve Bank of New Zealand (RBNZ) interest rate decision determines whether the country's official cash rate, the OCR, goes up, goes down or stays unchanged. The decision is announced in the early morning hours Tehran time and is the main driver of the New Zealand dollar throughout the year. At the top of this page you can see the current rate, the previous rate, the date of the last change and the next meeting, along with a chart and table of New Zealand's interest rate since 2000. If you want to compare New Zealand's rate with other central banks, the central bank interest rates page shows them all side by side.

The Reserve Bank of New Zealand and the OCR

The OCR is the rate the Reserve Bank of New Zealand sets for banks' overnight deposits and loans, and through this channel it affects mortgage rates, deposit rates and the value of the New Zealand dollar. The decision is made by the bank's Monetary Policy Committee, and its goal is to keep inflation within a 1 to 3 percent range, focusing on the 2 percent midpoint. Around 1990, New Zealand pioneered formal inflation targeting, an approach that many central banks around the world later adopted.

Seven decisions a year, two types of meeting

The RBNZ decides on the OCR seven times a year, but not all of these meetings carry the same weight:

Meeting type	Number per year	What is published
Monetary Policy Statement	4 times	The decision, a full report of economic forecasts, the projected OCR path and the Governor's press conference
Monetary Policy Review	3 times	The decision and a shorter statement along with a summary of the meeting

Meetings that come with a full report usually give the market more information and create larger volatility. In the Teagle economic calendar, the rate decision, the statement, the Monetary Policy Statement and the press conference each have a separate row, and the list of recent releases on this page shows them all together.

Announcement time in Tehran time

The RBNZ announces its decision at 2 p.m. Wellington time. New Zealand is in the Southern Hemisphere and its daylight saving time runs roughly from late September to early April; during this period the decision is released at around 4:30 a.m. Tehran time, and for the rest of the year at around 5:30 a.m. At this hour the market is still thin and the first move can be sharp; market orders may be filled with significant slippage . The countdown at the top of the page shows the exact time of the next meeting.

The projected OCR path: the key to reading the decision

A lesser-known feature of the RBNZ is that in its Monetary Policy Statements it also publishes the projected interest rate path for the coming quarters. That is why sometimes the decision itself is in line with expectations, yet the market moves sharply. To read an RBNZ decision, look at these in order:

• Decision vs. forecast: Was the rate change the size the market expected?
• OCR path: If the rate stayed unchanged but the future path is drawn higher than in the previous report, the bank's message is hawkish.
• Tone of the statement and meeting summary: Are committee members more worried about inflation or about economic growth?

How does the Kiwi react?

Among traders, the New Zealand dollar is called the "Kiwi"; you can find this nickname and those of other currencies in the article common currency nicknames in forex . A more hawkish tone than expected usually strengthens the Kiwi, and the biggest reaction is seen in the NZD/USD currency pair . The Kiwi is a small commodity currency and is sensitive to global dairy prices, the Chinese economy and market risk sentiment. It also moves in the same direction as the Australian dollar, so Kiwi traders also follow the Reserve Bank of Australia interest rate decision . The impact of this decision on the US dollar, gold or crypto is usually limited.

Risk management on decision morning

1. If you have an open position on the Kiwi, before going to sleep set your stop loss based on the typical volatility of decision days, not that of normal days.
2. Keep in mind that in a fast move, a stop loss may be executed at a worse price than the level you set.
3. Treat decisions that come with a full report as higher risk and reduce your position size accordingly.
4. Check the economic calendar to see whether New Zealand's inflation or employment data surprised in the previous weeks; these figures shape market expectations.

This page is for information only and is not a recommendation to buy or sell.