VIEW: Westpac Look For No Change In The OCR Today

Westpac now expect the Reserve Bank to leave the OCR on hold at today's Monetary Policy Statement. "Regardless of the economic case for higher interest rates, there is nothing to be gained from pushing the OCR higher now, rather than waiting for more clarity on the Covid situation."

• "The key here is that the Government cannot be confident about the scope of the problem. Further testing and tracing will be needed in the coming days to establish this."
• "Experience shows that economic activity tends to bounce back readily once Covid restrictions are lifted. And when that happens, the RBNZ will be left facing many of the same issues as before: an economy that is running up against cost pressures and capacity constraints, with risks that inflation could become more persistent. Ultimately we expect OCR hikes will still be needed, but we will review the likely timing of this as we get more clarity."