In order to stop future inflation, the Reserve Bank has decided that our interest rates, already the highest in the world, need to be raised even more, thus increasing mortgage inflation. In an economy that is starting to recover, the Big Hammer comes out again making sure that the middle class stays down.
Reserve Bank governor Graeme Wheeler lifted the official cash rate a quarter-point to 2.75 per cent in the first move of a tightening cycle, and signalled potential for a steeper track for future hikes as he tries to prevent inflation accelerating.
"While headline inflation has been moderate, inflationary pressures are increasing and are expected to continue doing so over the next two years," Wheeler said in a statement. "The speed and extent to which the OCR will be raised will depend on economic data and our continuing assessment of emerging inflationary pressures."
Thanks, Graeme. I wish we could vote this bozo out.
Related link: OCR up to 2.75pc ~ NZ Herald