OCR cut to mortgage property market
The Reserve Bank of New Zealand (RBNZ) cut the Official Cash Rate (OCR) by 50 basis points to 1% on 11 March 2020. This was the second OCR cut in as many months, and the third since August 2019.
The OCR is the interest rate that the RBNZ charges commercial banks for short-term loans. When the OCR is cut, it makes it cheaper for banks to borrow money, which in turn makes it cheaper for them to lend money to their customers.
The RBNZ cut the OCR in response to the economic impact of the COVID-19 pandemic. The pandemic has caused a sharp decline in global economic activity, and New Zealand is not immune to this. The RBNZ is cutting the OCR in an effort to stimulate economic activity and prevent a recession.
The OCR cut is likely to have a positive impact on the property market. Lower interest rates make it cheaper for people to borrow money to buy a house, which could lead to increased demand for housing. This could in turn lead to higher house prices.
However, it is important to note that the OCR cut is not the only factor that will affect the property market. Other factors, such as the state of the economy and the availability of credit, will also play a role.
Overall, the OCR cut is likely to have a positive impact on the property market, but it is too early to say for sure what the full impact will be.
The AI has provided us with the news.
I’ve asked Google Gemini the following question, and here’s its response.
Please search for “ocr cut mortgage property market” which is rapidly rising on Google Trends NZ and explain in detail. Answers should be in English.
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