These Are 'Interest-ing' Time We Are In
In a surprising move last week, the Reserve Bank slashed the Official Cash Rate (OCR) down to 1%, supposedly to reflate New Zealand's flagging economy.
The rate cut was expected, however only by .25% points to 1.25%. Cutting by half a percentage point has only ever ocurred 3 times in New Zealand since OCR's introduction in 1999; after the September 2001 terror attacks on the US, the 2008 GFC and the Christchurch earthquakes.
All in all this is big news for New Zealand, however what does it really mean? As expected, there are many and varied opinions on the matter, not least of which relates to less dollars being paid out to savers and those of retirement age.
For more insight, here's initial analysis from the NZ Herald* which sums it up nicely.
*Thanks nzherald.co.nz!