Latest OCR decision
On Wednesday 2 September, the Monetary Policy Committee agreed to increase the Official Cash Rate to 2.75%.
Download the MPS (PDF, 7MB)
Read the MPS online
The Middle East conflict has pushed up petrol and diesel prices.
The economy is recovering, despite interruption from the conflict.
We are increasing the OCR so that inflation gets back to 2%.
What's happening in the economy?
The Middle East conflict has pushed up petrol and diesel prices
Inflation rose to 4.1% in the June 2026 quarter as fuel prices increased due to conflict in the Middle East. We expect inflation to remain above 3% for the remainder of 2026. Higher fuel costs are making many goods and services, such as flights and food, more expensive.
We expect inflation to return to within our 1 to 3% target range next year and to 2% soon after.
The economy is recovering, despite interruption from the conflict
New Zealand’s economy was growing before the conflict. Lower interest rates and strong prices for key exports such as meat and dairy were supporting economic activity. However, economic growth was lacklustre in the June quarter. Higher fuel prices have left households with less money to spend on other goods and services. Unemployment remains high.
Businesses are reporting stronger activity over the past couple of months. The economic recovery has resumed, and this will encourage businesses to hire more staff and invest.
We are increasing the OCR so that inflation gets back to 2%
Higher interest rates will help bring inflation down. Lower inflation will help sustain the economic recovery.
We remain focused on getting inflation back to 2%. We may need to increase the OCR further this year.
Most recent outlook for the OCR
Decision documents
Monetary Policy Statement September 2026 data
XLSX | 2MB
Download XLSX
September 2026 MPS presentation slides
PDF | 2MB