The Reserve Bank is not expected this morning to follow the lead of its Australian counterpart in lifting the official cash rate.
The Reserve Bank of Australia raised the official cash rate by 0.25% points to 7.25%, and is now only 1% behind the New Zealand Reserve Bank's 8.25% OCR.
The Australian central bank last lifted the cash rate in February by 0.25%.
Predictions are the United States Federal Reserve will soon drop its lending rate below the current 3% to try and generate economic growth.
Westpac chief economist Brendan O'Donovan said the Reserve Bank of New Zealand was ‘‘firmly on hold''.
Rate hikes would not be foreshadowed in the bank's monetary policy but those looking for an easing bias would be disappointed.
‘‘Life has not gotten any easier for the Reserve Bank Sandwiched between rampant inflation pressures and an ugly outlook for the US and European economies, the Reserve Bank faces a policy dilemma".
‘‘The course of least resistance is inaction. We expect the rate to remain on hold in March and forecasts to imply rates remaining where they are from here.''
Westpac still believed the Reserve Bank was underestimating the momentum of inflation in the economy and that it would need to raise rates again by the end of the year.
