Key Facts:

  • Economists are split on when the Reserve Bank of New Zealand (RBNZ) will resume raising interest rates.
  • Some experts predict an increase as early as August 2022, while others believe it may not happen until 2023.
  • RBNZ had previously signaled a hike for this year, but this plan may be reassessed due to the impact of the COVID-19 Delta variant.
  • The housing market is a key factor influencing the decision to raise interest rates.
  • Higher interest rates can help cool down the housing market by making borrowing more expensive.
  • Other considerations include inflation, wage growth, and the broader economic recovery.
  • Uncertainty persists regarding the impact of COVID-19 on the economy and interest rate hikes.

Article Summary:

The experts disagree on when the Reserve Bank of New Zealand (RBNZ) will increase interest rates. Some predict that it may happen as early as August 2022, while others believe it could be pushed to 2023. The original plan for a rate hike in 2022 may be reconsidered due to the uncertainty created by the COVID-19 Delta variant.

One of the main factors influencing the decision to raise rates is the state of the housing market. Higher interest rates can help control housing price increases by making borrowing more expensive. However, other factors such as inflation, wage growth, and the overall economic recovery also come into play.

The impact of COVID-19 remains a significant source of uncertainty. The Delta variant has the potential to disrupt the economy, which could affect the timeline for rate increases. The RBNZ will closely monitor these factors before making any decisions.

To read the full article, go to:

https://i.stuff.co.nz/business/132999812/more-interest-rate-rises-ahead-how-the-experts-split