How will the Increase in the OCR Impact on Home Loans?
Has Alan Bollard put pressure on banks to hold rates and lower their margins by increasing the OCR or, will it be business as usual, OCR goes up, retail interest rates go up?
I guess it doesn’t matter what we think, as what is done is done, but one can still wonder why, question, and hasten a guess as to the reasoning why Alan Bollard opted to increase the Official cash rate, (the rate which impacts on retail home loans).
For if you read the following statement, Reserve Bank raises OCR to 3 percent it doesn’t really give justification to the rise.
So why did he do it? This is only a theory but I would like to put it out there for debate.
If Bollard had left the rate unchanged that would have had very little impact on the housing market. It may have helped the business sector a little but not a great deal and would have had little impact on our economy as a whole so he didn’t have much to gain either way or did he........
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