Reserve Bank of New Zealand

April 2026 Monetary Policy Review Media Conference

The Reserve Bank of New Zealand’s April 2026 Monetary Policy Review confirmed that the Official Cash Rate (OCR) will remain unchanged at 2.25%. Governor Anna Breman highlighted that the decision reflects heightened uncertainty after the Middle‑East conflict, which has disrupted oil, gas and fertilizer supplies and pushed global commodity prices higher. The committee revised its inflation outlook, projecting consumer‑price growth of about 3% in the first quarter and 4.2% in the second quarter, but stressed that these figures are highly sensitive to oil‑price movements and pass‑through effects on transport, airfare and food. Core inflation remains near the 2% target midpoint, while financial conditions have tightened, mortgage rates have risen and the New Zealand dollar has depreciated modestly. Breman noted that business surveys reveal a mixed picture: some firms plan temporary fuel surcharges, others intend permanent price hikes, and a few fear consumer resistance. The recent cease‑fire announcement caused oil prices to fall, prompting questions about whether the Q2 inflation forecast is on the high side. Committee members discussed a pre‑emptive rate hike as a way to curb medium‑term inflation, but consensus favored holding the OCR to avoid further weakening the still‑fragile recovery. The stance signals vigilance: the MPC will monitor core inflation, wage growth and inflation expectations, and stands ready to raise rates if medium‑term pressures emerge. Market participants should anticipate potential tightening later in the year, while households face near‑term price pressures from higher fuel costs and a slower economic rebound.