The Reserve Bank held the official cash rate at 2.75 percent on 28 October, with four committee members supporting a pause and three wanting an increase to 3 percent.
The decision differs from the increase widely expected by economists, according to RNZ's initial report. The Reserve Bank's statement and meeting record explain a disagreement about the timing of action, rather than a shared view that inflation pressure has disappeared.
Why four members wanted to wait
The majority pointed to the effects of two recent OCR increases and the value of observing more economic information. Annual inflation had been lower than expected, and wage growth and medium-term inflation expectations remained consistent with a return towards the target midpoint.
Those members also gave weight to weak household spending and investment. The bank describes a recovery that is stronger in export-facing industries than in businesses relying on domestic demand.
Why three members favoured a rise
The minority wanted a 25-basis-point increase. Their concern was that persistent core inflation and further fuel, freight and shipping costs could become embedded in how businesses set prices.
They considered aggregate growth sufficiently resilient to justify acting now, potentially reducing the need for more tightening later. All members agreed on the overall inflation outlook, while placing different weight on the risks and timing.
The next inflation number is a forecast
The bank puts annual inflation at 3.7 percent in the September quarter, down from 4.1 percent in June. It expects 4.4 percent in the December quarter, largely reflecting fuel futures prices.
That December number is a forecast. The statement stresses uncertainty around oil and refined-fuel prices. The committee considers tighter policy likely to be needed, but says future action remains conditional on the outlook.
What households can read from the decision
The hold confirms today's official cash rate. It does not fix every mortgage, savings account or business lending rate at the same level.
The bank's own record notes that wholesale interest rates have risen while some term lending rates have declined, with credit demand and deposits affecting transmission. A borrower approaching a fixed-rate expiry still needs the lender's actual offer and the date their existing term ends.
For small businesses and families, the published decision offers an explanation of the policy trade-off. It is not a guarantee that living costs will ease immediately or that the next meeting will deliver a particular result.
Sources: the Reserve Bank's 28 October statement and meeting record, and RNZ reporting. Checked 28 October 2026. General economic reporting, not personalised financial advice.
