Kiwi homeowners advised to brace for interest rate shifts
ASB CEO Vittoria Shortt (pictured above) has stressed the importance of New Zealanders preparing for all possible scenarios regarding interest rates.
Describing it as “dangerous” to speculate on the direction rates might take, Shortt’s comments come amidst speculation on the future movements of the OCR, which ASB’s economists predict will hold at 5.5% following the Reserve Bank’s upcoming meeting.
Despite stronger-than-expected employment data suggesting potential rate adjustments, Shortt told NZ Herald homeowners should be “prepared for any eventuality” in this “uncertain” economic environment, Newshub reported.
“I think it’s dangerous to bank on rates staying the same, or definitely moving higher, or definitely moving lower,” she said.
ASB’s outlook anticipates a possible reduction in interest rates by the Reserve Bank (RBNZ) in the second quarter of the year, with inflation expected to dip below 3% by the September quarter.
However, the bank acknowledged the risk of delays beyond their August forecast for OCR cuts.
“But we are also mindful that we are at a turning point in the economic data, which makes things hard to read and easy to flip-flop on OCR forecasts,” Shortt told NZ Herald.
“We will continue to watch events closely, but still judge that inflation and other data should give the RBNZ confidence to cut around August – November.”
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
