By Lucy Craymer
New Zealand’s top central banker said on Monday that if economic conditions evolve as expected the official cash rate was likely to remain at its current level for some time, pushing back on expectations of cash rate hikes next year.
“Financial market conditions have tightened since the November decision, beyond what is implied by our central projection for the (official cash rate),” Reserve Bank of New Zealand Governor Anna Breman said in a statement.
New Zealand’s central bank cut its official cash rate by 25 basis points to 2.25% at the end of November and signalled an end to the easing cycle. It has said the cash rate will remain on hold over the coming year, though by last week, markets had priced in more than two increases in 2026.
Following Breman’s comments, the kiwi dollar 
NZDUSD fell 0.3% to $0.5785, while two-year swap rates (NZDSM3NB2Y=) came off earlier highs and were last down 4 basis points at 3.014%.
Breman added in her statement that the monetary policymakers closely monitor wholesale market interest rates and their effects on households and businesses.
She added that ahead of the central bank’s next decision in February, the committee would assess incoming data, financial conditions, global developments and implications for New Zealand’s economic outlook and medium-term inflation objectives.
Monetary policy is not on a preset course, she said.