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May 12, 2026

Monetary Policy Expectations Analysis

Market ReportRates Govt BondsMacro Economic IndicatorsFinancials

This report details market expectations for central bank interest rate moves across NZ, US, AU, Eurozone, UK, and Canada through mid-2027.

Key Takeaways

  • 1.New Zealand's Official Cash Rate (OCR) is priced for a significant tightening cycle, rising from a current 2.25% to an expected 3.62% by August 2027.
  • 2.The Reserve Bank of Australia (RBA) is expected to raise the cash rate from 4.35% to a peak of approximately 4.72% by late 2026.
  • 3.US Federal Reserve expectations remain relatively flat with a minor upward bias, projecting a move from an effective FFR of 3.63% to 3.76% by April 2027.

Table of Contents

  • Monetary Policy Expectations Analysis
  • Important notice

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Securities

New Zealand Official Cash Rate (OCR)Effective Federal Funds Rate (FFR)RBA Cash RateSterling Overnight Index Average (SONIA)Euro Short-Term Rate (ESTRON)

Themes

Global Monetary TighteningInterest Rate Divergence

Regions

Asia PacificNorth AmericaEuropeNew ZealandUnited StatesAustralia