Nick Tuffley: ASB Senior Economist on the Reserve Bank raising the Official Cash Rate to 2.5%

The Reserve Bank says more OCR hikes are "likely", but it doesn't know how many more will be needed, or when they're likely to happen.  The central bank's raised the cash rate to 2.5% – the first hike in more than three years.  It wants to get the OCR back to a "neutral" level that doesn't contribute to inflation.  ASB Chief Economist Nick Tuffley told Ryan Bridge they believe the bank will steadily lift interest rates over the rest of the year – bringing the cash rate back to 3.25% by the end of the year.  He says there is a chance they’ll pause along the way, but having done one, they think it’s very likely they’ll follow through in September.  LISTEN ABOVE See omnystudio.com/listener for privacy information.