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What a negative Official Cash Rate could mean for you
22 October 2020
Amid growing economic concerns due to the COVID-19 pandemic, the Reserve Bank of New Zealand (RBNZ) has made it clear one policy tool at its disposal is a negative Official Cash Rate (OCR). In fact, since the 12 August monetary policy statement, several bank economists have forecast the OCR to go negative by early 2021.
Negative interest rates are by no means a new phenomenon. In response to the Global Financial Crisis, Sweden’s central bank was the first to cut rates below zero, and since then, the European Central Bank, the Bank of Japan and the Swiss National Bank have all taken policy rates below zero.
This article has been prepared by ANZ New Zealand Investments Limited for information purposes only and it should not be treated as financial advice. It is recommended that you seek advice from an authorised financial adviser which takes into account your individual circumstances before you acquire a financial product.