Rates climb, with more pain ahead

The Reserve Bank’s decision to increase the Official Cash Rate by 50 basis points today means yet more pain for anyone with a mortgage, says National Finance spokesperson Nicola Willis.

“Not since the dawn of the OCR have New Zealanders experienced such a relentlessly steep climb in interest rates. A 50 basis points rise is unusual, while five in a row is unprecedented. Homeowners are in for a pummelling as a result.

“This is particularly bad news for anyone having to re-fix in the coming months. Many families will now be forced to prepare themselves for a more-than-doubling in the cost of their mortgage interest. Bigger mortgage payments will blow up household budgets, creating financial stress and taking Kiwis backwards.

“The Government’s cavalier approach to its own spending has put fuel on the inflation fire, stoking the cost of living crisis and forcing the Reserve Bank to pull ever harder on the interest rate hand brake to try and control it.

“The Government has completely failed to curb its spending in the wake of its Covid spend-up. This year, the Government will spend a billion dollars more each week than when it came to office. Tragically, it has very few results to show for it.

“The time for political band-aids is over. The Government must step-up and present a plan to address the underlying drivers of New Zealand’s cost of living crisis, bring discipline to spending and roll back the tidal wave of costs it has unleashed on New Zealanders.”