Predicting Interest Rates - it's impossible!

Group of business people starring into a crystal ball

 

Predicting future interest rates can be tricky, as they are influenced by a variety of factors such as inflation, economic growth, and government policies. However, there are a few things we can consider when trying to make an educated guess about future interest rates in New Zealand.

Firstly, it's important to keep an eye on the Reserve Bank of New Zealand (RBNZ) and their monetary policy decisions. The RBNZ sets the official cash rate, which is the interest rate that banks use to borrow and lend money to each other. Changes to this rate can have a ripple effect on other interest rates in the economy.

Secondly, you may want to consider the state of the New Zealand economy. If the economy is growing strongly and inflation is high, the RBNZ may raise interest rates to try and cool things down. On the other hand, if the economy is struggling and inflation is low, the RBNZ may lower interest rates to try and stimulate growth.

Finally, it's worth keeping an eye on global economic trends and events, as these can also impact interest rates in New Zealand. For example, if there is a global recession, the RBNZ may lower interest rates to try and support the New Zealand economy.

Of course, these are just a few factors to consider when trying to predict future interest rates in New Zealand. It's always important to do your own research and consult with experts (mortgage broker, accountant) in the field to get a more accurate picture.

 

  • Money Management