# Reserve Bank Hikes Rates Ahead of Election

> New Zealand's central bank raises interest rates by 25 basis points during election campaign, a rare move to combat inflation.
- Title: Reserve Bank Hikes Rates Ahead of Election · RNZ | Shortify
- Summary: New Zealand's central bank raises interest rates by 25 basis points during election campaign, a rare move to combat inflation. The Reserve Bank increased…
- Keywords: reserve bank, interest rate, election, inflation, new zealand, central bank, election campaign, politics, news, Reserve, Bank, Hikes
- Source: RNZ — https://rnz.co.nz/news/business/2197863/why-the-reserve-bank-is-about-to-do-something-relatively-rare
- Author: RNZ | Te Reo Irirangi o Aotearoa
- Published: 2026-10-27T19:11:13+00:00
- Read time: 1 min
- Topics: reserve bank, interest rate, election, inflation, new zealand, central bank, election campaign, politics, news
## Reserve Bank Hikes Rates
The Reserve Bank is likely to hike interest rates by 25 basis points during the final stages of an election campaign.

> Economists expect the official cash rate to be increased by 25 basis points as the central bank leans against inflation being pushed up by higher fuel prices.
## Historical Context
The Reserve Bank previously raised rates in 2014, 2008, 2002, and 1999 during election periods.

> In 2008, it cut the rate by 100 basis points a matter of weeks before the election.
## Economist Analysis
Gareth Kiernan notes the election outcome's uncertainty this time versus past non-close elections.

> The Reserve Bank was independent and needed to do its job of keeping inflation under control rather than worrying whether people would think its actions reflected the government's performance.
## Political Impact
Kelly Eckhold says the cost of living concerns outweigh interest rate changes for voters.

> The Reserve Bank is weighing up the sort of the economy versus the cost of living in terms of what it's doing.
## Voter Perception
Ben Thomas believes the impact on voters will be limited due to their economic concerns.

> The Reserve Bank would act in the run-up to the election if the inflation outlook required it.
## Economic Signal
The Reserve Bank signals inflation is too high and the economy is too strong, creating voter confusion.

> Many people will feel that the economy is not that strong and inflation is making them poorer.
## Key takeaway

The Reserve Bank increased interest rates by 25 basis points ahead of the election to address inflation, despite political tensions.