Other G10 Central Banks: RBA, BoC, SNB, Nordics, RBNZ — 2026-10-28
The Reserve Bank of New Zealand (RBNZ) shocked global markets by holding interest rates steady despite near-universal expectations of a hike, causing the New Zealand dollar to drop 1.6%. Meanwhile, the Bank of Canada executed a 25-basis-point rate increase to 2.5% to combat persistent inflation, and Sweden's Riksbank held its rate at 1.75% while signaling future tightening.
Other G10 Central Banks: RBA, BoC, SNB, Nordics, RBNZ — 2026-10-28
Top developments
RBNZ Surprise Hold Sends Kiwi Tumbling
On Wednesday, October 28, the RBNZ defied market consensus by keeping the Official Cash Rate (OCR) unchanged at 2.75%. The decision, passed by a narrow 4–3 vote, triggered an immediate 1.6% decline in the NZD/USD exchange rate as traders repriced expectations for December. The currency has now lost nearly 5% against the US dollar over the past six months, reflecting deep uncertainty about the central bank's commitment to tightening.
Bank of Canada Hikes to 2.5%
The Bank of Canada raised its policy interest rate by 25 basis points to 2.5% on October 28, citing the need for preemptive tightening to anchor inflation expectations. The move comes as Canadian inflation remains elevated at 3.1%, prompting the central bank to prioritize price stability over near-term economic softness.
Riksbank Holds at 1.75% While Flagging Future Hikes
Sweden’s Riksbank left its repo rate unchanged at 1.75% on October 26 but removed previous language suggesting rates would stay low for an extended period. Local analysts note that the bank’s hawkish shift in tone has strengthened the krona, with economists now predicting a 25-basis-point hike in November as the next step.
Local view
In Canada, the BNN Bloomberg highlighted the Bank of Canada's explicit statement that the economy is operating above capacity, justifying the hike despite signs of labor market cooling. In Sweden, Affärslivet reported that households are bracing for higher mortgage rates, with the Riksbank's decision to hold rates seen as a "pause before the next leg up" rather than a reversal.
Context & numbers
- New Zealand: The OCR remains at 2.75%. The NZD/USD pair dropped to levels not seen in months following the surprise hold.
- Canada: The overnight rate is now 2.50%. Canadian 30-year bond yields have hovered near 6% in recent weeks, reflecting inflation concerns.
- Sweden: The repo rate is 1.75%. Most forecasters expect the rate to rise to 2.0% by the end of 2026.
On the radar
- Riksbank November Meeting: Economists are nearly unanimous in predicting a rate hike on November 4, 2026.
- RBNZ December Review: Markets are now pricing a higher probability of a 25bp hike in December following the October surprise, though uncertainty remains high.
- Norges Bank: No new decision was announced this week, but the central bank’s September statement signaled a path toward further tightening, with the current rate at 4.50%.
This content was collected, curated, and summarized entirely by AI — including how and what to gather. It may contain inaccuracies. Crew does not guarantee the accuracy of any information presented here. Always verify facts on your own before acting on them. Crew assumes no legal liability for any consequences arising from reliance on this content.
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