The Reserve Bank held the Official Cash Rate at 2.75% on 28 October, but only just. Four members of the Monetary Policy Committee voted to hold and three wanted a hike to 3%. If your fixed rate is rolling over in the next few weeks, that split vote matters more than the headline.
Here's what the decision actually said, what it could mean for your next refix, and when it's worth looking past your current bank altogether.
What did the Reserve Bank decide in October 2026?
The OCR stayed at 2.75%, after two increases earlier this year took it up from 2.25%. Every committee member agreed that tighter policy is likely to be needed, but they split on whether to move now or wait.
Annual inflation was 3.7% in the September quarter, down from 4.1% in June, and the Reserve Bank expects it to rise to 4.4% in the December quarter, mostly because of fuel prices. Core inflation is sitting around the top of the 1% to 3% target band. The next decision, with a full Monetary Policy Statement, is on 9 December 2026.
Does a hold mean mortgage rates will stay put?
Not necessarily. Fixed mortgage rates follow wholesale rates, and the Reserve Bank itself noted that wholesale rates have risen as markets price in a higher OCR.
That said, the Reserve Bank also pointed out that weak demand for credit and strong deposits mean banks haven't passed every wholesale increase through to borrowers. On interest.co.nz's 29 October table, several main banks were advertising one-year specials for borrowers with 20% equity at around 4.99% to 5.19%, with floating rates around 6.25% to 6.39%. Those numbers can move any day, so treat them as a snapshot.
My fixed rate rolls over before 9 December. What should I think about?
Start with your own cashflow, not a rate prediction. The committee was openly split, which tells you even the experts aren't sure where the next move lands.
A few questions help narrow it down:
- Could your budget handle a higher payment if you fix short and rates rise again at your next rollover?
- Are you expecting a lump sum, a sale or a big change in income in the next year or two? That usually points towards keeping some flexibility.
- Would splitting your loan across two or three terms take the pressure off any single rollover date?
We wrote more on choosing a term in how long should I fix my mortgage. The short version: the right term is the one your cashflow can live with, whatever happens on 9 December.
If you'd like someone to run the numbers on your actual loan, Book a free 15-minute consultation and we'll talk you through it.
Should I float until after the December decision?
Floating gives you flexibility, but it costs more while you wait. With floating rates around a percentage point above the one-year specials on the 29 October table, a few months on floating can add up on a big loan.
Floating a small portion can still make sense if you plan to make lump-sum repayments or sell soon. Floating the whole lot purely to wait for a better rate is a bet, and the Reserve Bank has said further increases are likely.
Is now a good time to switch banks?
It can be, if your current lender won't sharpen its offer. Banks compete hard for good borrowers, and a rollover is usually the cheapest moment to move because there's no break fee on a loan that's coming off its fixed term.
Before you jump, check three things:
- Cashback clawback. If your current bank paid you a cashback, your loan contract will say whether you have to repay some or all of it if you leave within a set period.
- The full cost. Legal fees, valuation and any discharge fees can eat into a small rate saving.
- Your situation now. If your income, employment or property value has changed, a new lender will reassess you from scratch.
interest.co.nz has a calculator that factors in cashbacks and other costs, which is a handy first check. If you're partway through a fixed term, read our guide on mortgage break fees before you do anything.
Common questions about the OCR and your mortgage
When is the next OCR announcement?
The next OCR decision is at 2pm on Wednesday 9 December 2026, alongside the Reserve Bank's Monetary Policy Statement.
Does the OCR change my fixed mortgage rate straight away?
No. A fixed rate stays the same until your term ends. The OCR mainly affects floating rates and the new fixed rates banks offer when you refix.
Why didn't the Reserve Bank raise the OCR?
Four members wanted more time to see how the two earlier increases were flowing through, and they were worried about weak household spending. Three members wanted to act now because core inflation has stayed high for a while.
Can a mortgage adviser get me a better rate than my bank?
Often, yes. An adviser can compare lenders and negotiate on your behalf, and it costs you nothing to ask. Your bank is always welcome to match the offer.
How we can help
Invicta's mortgage advisers give fee-free advice. We'll look at your rollover date, your current rate and any cashback conditions, then compare what other lenders will offer you. If staying with your bank is the better deal, we'll say so and help you negotiate. If moving makes sense, we handle the paperwork. Find out more about our mortgage advice.
Get your rollover sorted before December
The split vote is a reminder that nobody knows exactly where rates go next. A plan that works for your budget beats trying to time the market.
Want a second opinion on your rollover before you sign anything?
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Sources
- Reserve Bank of New Zealand, OCR held at 2.75% (Monetary Policy Review and Record of Meeting, 28 October 2026)
- Reserve Bank of New Zealand, The Official Cash Rate (next update 9 December 2026)
- Reserve Bank of New Zealand, Past monetary policy decisions
- interest.co.nz, Daily mortgage newsletter, 29 October 2026
- RNZ, Reserve Bank holds OCR at 2.75% in split decision (28 October 2026)
General Information Disclaimer
The information in this article is general in nature and is not intended to be personalised financial advice. It does not take into account your individual goals, financial situation, needs, or circumstances.
Any examples, figures, rates, or scenarios are for illustrative purposes only and may change over time.
Before making any financial decision, you should consider whether the information is appropriate for your circumstances and, where appropriate, seek personalised advice from a licensed financial adviser.
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