It is the last update to the OCR for the year, and a "frontloaded" cut of 50bps is expected by most economists.
Most then think the bank will shift to 25bps cuts from February next year.
Most forecasts have the OCR eventually dropping to around 3%, with retail rates in the 5% to 5.5% range.
But forecasters are urging borrowers not to expect dramatically better deals on their home loans later this week.
Infometrics chief forecaster Gareth Kiernan said a 50bp cut had already been priced in by financial markets.
"I would expect the effect on fixed mortgage rates to be limited - you might see fixed mortgage rate cuts of about 10 basis points come through in the week following the OCR review, while floating rate movements tend to match the OCR, so they'd be likely to drop by 50 points," he said.
Kiernan said, if the Reserve Bank opted to cut the OCR by 75bps rather than 50, as some have suggested could be possible, the impact on markets would depend on whether it was seen as the central bank bringing forward future cuts, or signalling there would be more cuts than previously expected.
"Either way, I would expect it to add at least another 10 basis points to fixed rate cuts in the next week, but it could lead to rates being lowered by as much as 40 basis points in total."
But he said the complicating factor was that wholesale swap rates for terms of two years or more had increased a lot in the last two months.
"It looks like a definite shift in sentiment from the downward trend we've seen since the end of May. It appears to be partly driven by international factors, with the re-election of Donald Trump raising concerns about stimulatory or inflationary fiscal policy in the US, and partly by domestic factors as markets see signs of the NZ economy starting to emerge from the zero growth of the last 24 months."
This shift in wholesale markets is thus placing some upward pressure on retail rates for two-plus years, which mostly hasn't been passed on by the banks yet.
The upshot is that, unless there is another change in the trend in wholesale markets, the lift in wholesale rates over the last couple of months is likely to limit the pass-through of any OCR cut - even a larger-than-expected one - into longer-term mortgage rates.
Kim Mundy, senior economist at ASB, agreed with Kiernan that wholesale rates increasing would be an issue.
"The OCR is one of the factors that go into retail mortgage rates and there are a lot of moving parts at the moment.
"She said she was still expecting more cuts next year, too, but the pace would reduce, which would also slow any drop in home loan rates."
Jeremy Andrews, a mortgage adviser at Key Mortgages, said the market was still moving around a lot.
One of the banks pulled back their discount we typically negotiate on six-month fixed by effectively raising the rate to 6.49%.
Soon after this however BNZ dropped their six-month rate and we're now negotiating 30 points discount with most banks to 5.99% for six months fixed.
"The 12-month special discretionary discounted rate of 5.59% that we were negotiating for much of last month, was also withdrawn soon before the US election. We haven't seen much movement in the mid term rates, and the long term rates have remained at similar levels for many months - which might also indicate uncertainty about foreign growth and inflation along with geopolitical risks too."
