Breman Speech: RBNZ Governor sheds light on inflation and interest rate outlook
Reserve Bank of New Zealand’s (RBNZ) new Governor Anna Breman presents the prepared remarks on the policy statement and responds to media questions at the press conference after the April monetary policy announcement.
Earlier on, Breman and her colleagues decided to leave the Official Cash Rate (OCR) unchanged for the second consecutive meeting at 2.25%, as widely anticipated.
RBNZ press conference key quotes
Project CPI at 4.2% in Q2, forecast uncertain.
Will have full economic forecasts at our May meeting.
Spare capacity to remain for some time.
Discussed raising rates relatively early, like at today's meeting.
We discussed raising rates at today's meeting.
If oil prices keep falling our inflation forecast would be on the high side.
Were not close to raising rates today.
No strong advocates for hiking today.
Did note financial conditions have tightened, likely to dampen growth a bit.
Not yet seeing rising prices becoming embedded in inflation expectations.
Neutral rate is a range with a midpoint at 3.0%.
Tightening could be at every meeting or every other meeting, it depends.
Looking at wage growth, inflation expectations, core inflation.
Economic Indicator
RBNZ Press Conference
Following the Reserve Bank of New Zealand's (RBNZ)monetary policy decision, the Governor gives a press conference explaining the rationale behind the decision. The comments may influence the volatility of the New Zealand Dollar (NZD) and determine a short-term positive or negative trend.
Read more.Next release: Wed Apr 08, 2026 03:00
Frequency: Irregular
Consensus: -
Previous: -
Source: Reserve Bank of New Zealand
The Reserve Bank of New Zealand (RBNZ) holds monetary policy meetings seven times a year, announcing their decision on interest rates and the economic assessments that influenced their decision. The central bank offers clues on the economic outlook and future policy path, which are of high relevance for the NZD valuation. Positive economic developments and upbeat outlook could lead the RBNZ to tighten the policy by hiking interest rates, which tends to be NZD bullish. The policy announcements are usually followed by Governor Anna Breman's press conference.
This section below was published at 02:00 GMT following the Reserve Bank of New Zealand (RBNZ) monetary policy announcements.
The Reserve Bank of New Zealand (RBNZ) decided to hold the Official Cash Rate (OCR) steady at 2.25% after concluding the April monetary policy meeting on Wednesday.
The decision aligned with the market expectations.
Summary of the RBNZ Monetary Policy Review (MPR)
The monetary policy committee today agreed to hold the OCR at 2.25 percent.
Events in the Middle East have materially altered the outlook and the balance of risks for inflation.
In the near term, inflation is expected to increase and the economic recovery to weaken.
The monetary policy committee is focused on ensuring that inflation returns to the 2-percent target midpoint over the medium term.
The committee is vigilant to any generalised inflationary pressure and stands ready to act to return inflation.
This requires core inflation and wage growth to remain contained and medium- and long-term inflation expectations to remain around 2 percent.
If these conditions are not met, decisive and timely increases in the OCR would be required.
The extent of the near-term increase in headline inflation will depend on how the conflict in the Middle East evolves and the magnitude and duration of the disruption to global supply chains and energy markets.
The current economic situation is different to 2022 when covid-19 and Russia's invasion of Ukraine disrupted global supply chains and increased energy prices. Back then, demand was growing strongly, adding to inflation pressure.
The committee's decision to hold the OCR balances the potential benefits of responding pre-emptively to the risk of higher medium-term inflation against the cost of unnecessarily stifling the economic recovery.
Minutes of the RBNZ interest rate meeting
Conflict in the Middle East is leading to significant supply side disruptions
On Wednesday, 8 April, the committee reached consensus to hold the OCR at 2.25 percent.
Supply chain disruptions will lead to higher near-term inflation in New Zealand.
Economic growth is expected to be weaker in the near term.
Committee will continue to assess the countervailing forces on the inflation outlook and stands ready to act decisively to ensure that inflation reaches the 2 percent mid-point of the target band in the medium term.
Some members placed more emphasis on the arguments in favour of an early monetary policy response, noting that further data and analysis would provide greater clarity about medium-term inflation pressures.
Other members emphasised downside risks to growth and argued for more opportunity to judge the extent to which weaker growth balances the second-round effects of higher fuel prices.
If the increase in near-term inflation is largely temporary, the committee envisages gradually moving the OCR to more neutral levels as activity recovers and near-term inflationary pressures dissipate.
Short-term inflation expectations are increasing.
However, any signs of significant second-round inflationary effects or increases in medium-term inflation expectations would require decisive and timely increases in the OCR to re-anchor inflation expectations.
In the near term, the committee expects higher fuel prices to spill over into increased transport and food prices.
NZD/USD reaction to the RBNZ interest rate decision
The New Zealand Dollar attracts some buyers in an immediate reaction to the RBNZ interest rate decision. The NZD/USD pair currently trades at 0.5808, up 1.33% on the day.
New Zealand Dollar Price Today
The table below shows the percentage change of New Zealand Dollar (NZD) against listed major currencies today. New Zealand Dollar was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.72% | -0.86% | -0.81% | -0.32% | -1.28% | -1.28% | -0.96% | |
| EUR | 0.72% | -0.15% | -0.09% | 0.39% | -0.55% | -0.58% | -0.26% | |
| GBP | 0.86% | 0.15% | 0.04% | 0.54% | -0.38% | -0.41% | -0.11% | |
| JPY | 0.81% | 0.09% | -0.04% | 0.47% | -0.45% | -0.46% | -0.15% | |
| CAD | 0.32% | -0.39% | -0.54% | -0.47% | -0.92% | -0.93% | -0.63% | |
| AUD | 1.28% | 0.55% | 0.38% | 0.45% | 0.92% | -0.02% | 0.29% | |
| NZD | 1.28% | 0.58% | 0.41% | 0.46% | 0.93% | 0.02% | 0.31% | |
| CHF | 0.96% | 0.26% | 0.11% | 0.15% | 0.63% | -0.29% | -0.31% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the New Zealand Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent NZD (base)/USD (quote).
This section below was published on April 7 at 21:15 GMT as a preview of the Reserve Bank of New Zealand (RBNZ) interest rate decision.
- The Reserve Bank of New Zealand is set to hold the key interest rate at 2.25% for a second straight meeting on Wednesday.
- The RBNZ’s Monetary Policy Review and Governor Breman’s words will be closely scrutinized for policy guidance.
- The New Zealand Dollar is expected to rock in reaction to the RBNZ policy announcements.
The Reserve Bank of New Zealand (RBNZ) is set to extend the pause on its current interest rate-cutting cycle for the second consecutive meeting on Wednesday, leaving the Official Cash Rate (OCR) unadjusted at 2.25%, as the Iran war adds uncertainty to the economic and inflation outlook.
The decision is widely expected and will be announced at 02:00 GMT, accompanied by the Monetary Policy Review (MPR) and the Minutes of the meeting. RBNZ Governor Dr. Anna Breman will hold the post-monetary policy meeting press conference at 03:00 GMT.
The New Zealand Dollar (NZD) could experience intense volatility on either a probable hawkish pivot from the RBNZ or its wait-and-see stance.
What to expect from the RBNZ interest rate decision?
With a rate on-hold decision fully baked in, markets will dissect the RBNZ MPR and Governor Breman’s commentary for any hints on a likely rate hike this year in the wake of the energy shock-driven higher inflation projections.
During the press conference, Breman is expected to stick to the script delivered in her recent speech on March 23.
Back then, Breman said that the Bank is “looking for second-round effects” and “if inflation expectations shift, (it) will act. “
“[We] do not want to react too soon to inflationary pressures,” she added, safeguarding against premature tightening of financial conditions.
New Zealand’s annual inflation rate stood at 3.1% in the quarter ending December 2025, slightly above the RBNZ’s target range of 1% to 3%.
The Minutes of the meeting will also hold some relevance as these could provide insights about a probable debate among policymakers over the likelihood of second-round persistent inflation, potentially offering policy guidance.
“Like the Governor's speech last week, the Bank's communication is likely to reaffirm the Bank's reluctance to respond impulsively to the supply shock, especially when the economy is operating below capacity, Analysts at TD Securities (TDS) said. “This should challenge the market's pricing of more than 75bps of hikes this year.”
How will the RBNZ interest rate decision impact the New Zealand Dollar?
The NZD/USD pair hovers near the five-month lows of 0.5681 in the lead-up to the RBNZ showdown. Will the RBNZ’s hawkish pivot rescue the Kiwi bulls?
If the RBNZ surprises with hints on a potential shift toward interest-rate hikes later this year, the NZD could embark upon a sustained recovery against the US Dollar (USD).
On the contrary, if the central bank dismisses concerns over the near-term inflation shock and sticks to a wait-and-see stance, the Kiwi Dollar could resume its bearish trend.
Dhwani Mehta, Asian Session Lead Analyst at FXStreet, offers a brief technical outlook for NZD/USD and explains:
“The Kiwi remains vulnerable, despite the dead cat bounce. The 14-day Relative Strength Index (RSI) holds well below the midline, while a Bear Cross is playing out. The 21-day Simple Moving Average (SMA) closed below the 100-day SMA on April 1, confirming the bearish bias.”
“The immediate resistance is seen at the 0.5750 psychological level on the road to recovery. The next topside hurdles align at the 0.5800 round figure and the 100-day SMA at 0.5840. On the flip side, strong support is seen at the 0.5600 threshold, below which the November 2025 low of 0.5580 will be at risk. The line in the sand for NZD bulls is at the 0.5550 mark,” Dhwani adds.
Central banks FAQs
Central Banks have a key mandate which is making sure that there is price stability in a country or region. Economies are constantly facing inflation or deflation when prices for certain goods and services are fluctuating. Constant rising prices for the same goods means inflation, constant lowered prices for the same goods means deflation. It is the task of the central bank to keep the demand in line by tweaking its policy rate. For the biggest central banks like the US Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BoE), the mandate is to keep inflation close to 2%.
A central bank has one important tool at its disposal to get inflation higher or lower, and that is by tweaking its benchmark policy rate, commonly known as interest rate. On pre-communicated moments, the central bank will issue a statement with its policy rate and provide additional reasoning on why it is either remaining or changing (cutting or hiking) it. Local banks will adjust their savings and lending rates accordingly, which in turn will make it either harder or easier for people to earn on their savings or for companies to take out loans and make investments in their businesses. When the central bank hikes interest rates substantially, this is called monetary tightening. When it is cutting its benchmark rate, it is called monetary easing.
A central bank is often politically independent. Members of the central bank policy board are passing through a series of panels and hearings before being appointed to a policy board seat. Each member in that board often has a certain conviction on how the central bank should control inflation and the subsequent monetary policy. Members that want a very loose monetary policy, with low rates and cheap lending, to boost the economy substantially while being content to see inflation slightly above 2%, are called ‘doves’. Members that rather want to see higher rates to reward savings and want to keep a lit on inflation at all time are called ‘hawks’ and will not rest until inflation is at or just below 2%.
Normally, there is a chairman or president who leads each meeting, needs to create a consensus between the hawks or doves and has his or her final say when it would come down to a vote split to avoid a 50-50 tie on whether the current policy should be adjusted. The chairman will deliver speeches which often can be followed live, where the current monetary stance and outlook is being communicated. A central bank will try to push forward its monetary policy without triggering violent swings in rates, equities, or its currency. All members of the central bank will channel their stance toward the markets in advance of a policy meeting event. A few days before a policy meeting takes place until the new policy has been communicated, members are forbidden to talk publicly. This is called the blackout period.