The Reserve Bank of New Zealand (RBNZ) has cut the Official Cash Rate (OCR) by 25 basis points to 3 percent — the lowest level in three years — in a split decision that left the door open for further reductions.
Property market impact
Managing Adviser, Nathan Miglani, Squirrel , welcomed the move, calling it positive news for homebuyers.
“This was expected — everyone predicted the OCR to go down,” Miglani said. “This is such great news for homebuyers. The near 2 
percent drop over the last twelve months is good news. Repayments will come down, affordability will increase.”
"People will overall feel very positive about the housing market," he added.
He added that after three to four years of sluggish activity in the housing market, momentum had begun to return. “As mortgage advisers, we are encouraging first-home buyers to act now, as the momentum will keep building in New Zealand for housing market.”
Economic outlook
The RBNZ expects annual inflation to reach 3 percent in the September quarter, reflecting higher food, administered, and tradable goods prices. However, it believes this rise will be short-lived, with inflation expected to ease back to the 2 percent midpoint as tradables pressures dissipate and spare capacity curbs domestic price growth.
High-frequency data suggested the economy contracted in the second quarter of 2025, weaker than previously expected in May. The slowdown was linked to falling employment, slower wage growth, weaker household savings, and rising costs of essentials such as food, gas, electricity, and council rates.
Global conditions were also weighing on the outlook, with tariffs on New Zealand exports to the United States higher than anticipated. The RBNZ noted some industries may face more challenging export conditions, though it said the global economy appeared to be adjusting broadly in line with expectations
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