The Marlborough Chamber of Commerce is "disappointed" at the Reserve Bank of New Zealand's decision to increase the official cash rate (OCR), saying it will hurt Marlborough's businesses.
General manager Brian Dawson said while the increase from 2.5 per cent to 2.75 per cent came as no surprise, some regions of the country were performing better than others. "While I understand the need for a one-policy approach, it's fair to say other areas have pulled out of the recession better than Marlborough has."
It was a concern for the region because investors needed to be confident in businesses and their "actions and intentions are affected by the OCR".
He said that although it could be equally difficult for businesses across the board, consumers might think twice about buying larger or luxury items. The rise could be a factor in purchasing decisions if consumers were on the "tipping point" of buying items. Homeowners could also face some difficulty.
SBS Bank branch manager Greg Stretch said floating mortgage rates tended to follow when the OCR went up; fixed rates were more stable.
He said the floating interest rate at SBS was 5.9 per cent, but would rise to 6.15 per cent. That would mean an extra $16.09 a month for a $100,000 mortgage over 30 years.
"In the current environment, people are working with a tight budget. There isn't a lot of surplus cash so if there are further increases it could eat away at those funds," he said.
However, ASB commercial manager Graeme Andrews said he anticipated "fairly minor" changes. Floating preferred, page 11
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