RBNZ lowers OCR 25bps to 3%

By Sophia Rodrigues

Published On 20 Aug 2025 , 12:13 PM

The Reserve Bank of New Zealand cut the Official Cash Rate by 25bps to 3.00%, taking the total cuts in the current easing cycle to 250bps.

The OCR had peaked at a high of 5.50% in May 2023 before it was first lowered by 25bps in August last year.

The decision was a result of a majority 4-2 vote, and following discussions of three options: Hold, 25bps cut and 50bps cut.

The RBNZ cited significant spare capacity and declining inflationary pressure as reasons for the cut, and flagged two more cuts as the base case.

"If medium-term inflation pressures continue to ease as expected, there is scope to lower the OCR further," the RBNZ said.

 

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