OCR Holds at 2.75%: What Does It Mean for Borrowers?

Written by Kim Manunui

The Reserve Bank of New Zealand (RBNZ) has held the Official Cash Rate (OCR) at 2.75%, following its latest review on Wednesday 28 October. The decision provides some stability for borrowers, but the outlook for interest rates remains uncertain.

The decision was a close one, with four Monetary Policy Committee members voting to hold the OCR and three favouring an increase to 3.00%.

Inflation Remains a Key Concern

Annual inflation fell to 3.7% in the September quarter, down from 4.1% in June. However, inflation remains above the Reserve Bank’s 1–3% target band. The Bank expects annual inflation could rise to 4.4% in the December quarter, largely due to higher fuel prices and global energy market pressures.

While the economy continues to recover, conditions remain mixed. Export-focused industries are performing more strongly, while household spending and parts of the domestic economy remain subdued.

The Reserve Bank has indicated that further OCR increases may be required, depending on how inflation and economic conditions develop.

What Does This Mean for Mortgage Holders?

An unchanged OCR does not automatically mean mortgage rates will fall or remain unchanged. Banks also consider wholesale funding costs, market expectations and competition when setting lending rates.

For homeowners approaching a fixed-rate expiry, reviewing options early can help avoid a last-minute decision. Depending on your circumstances, splitting a mortgage across different fixed terms or retaining some flexibility may be worth considering.

Home buyers, property investors and businesses should also assess affordability and cash flow, allowing room for potential changes in borrowing costs.

When Is the Next OCR Announcement?

The next OCR announcement is scheduled for Wednesday 9 December 2026 at 2.00pm. This will be a Monetary Policy Statement, providing an important update on the Reserve Bank’s economic outlook, inflation forecasts and interest rate direction.

Until then, borrowers should keep an eye on economic developments and avoid assuming interest rates will automatically move in either direction.

The Bottom Line

The latest decision offers a pause rather than a guarantee of lower interest rates. With inflation still elevated and further OCR increases possible, reviewing your lending structure and planning ahead remain important.

At Infinance, we help clients navigate finance, mortgages and insurance to find solutions suited to their circumstances.

Want to review your mortgage or finance options? Get in touch with Infinance.

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Kim Manunui

Hi, I’m Kim and I work with a great team to help individuals, as well as small and not so small businesses get their message, product and services to the world using digital media and creating wonderful websites that don’t cost the earth.

I was born in Canada, and grew up around Vancouver and the mountains of British Columbia. My love of pristine environments led me to New Zealand and eventually to the mountains, lakes and rivers of the central North Island which is home. My family’s heritage is here, and it’s from here that Korio traverses the planet.

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