Category: Business

Source: Radio New Zealand

Kiwirail has nearly tripled its half-year earnings as it carried more freight.

The state-owned rail operator’s operating surplus for the six months ended December was $73.4 million compared to $25.8m a year ago.

Freight volumes increased 7 percent as there was an increase in demand and bulk cargo volumes returned to normal.

Its revenues increased 4 percent to $537m but operating costs fell 6 percent to $464.4m

Chief executive Peter Reidy said spending on engines and rolling stock, along with improvements in the rail network and infrastructure were paying off.

“These gains were achieved while we continued to navigate network constraints, particularly in Auckland, and weather-related impacts across parts of the network.”

Board chair Suzanne Tindal said it was a disciplined performance.

“We remain on track against a full year operating surplus target of $160 million,” Tindal said.

“This reflects improved operating performance across our commercial businesses and early progress from initiatives to strengthen productivity and reduce our cost base.”

Kiwirail said more than $9 billion had been invested to upgrade tracks, signalling and infrastructure assets, and to modernise rolling stock.

“In HY26, $601 million was invested across the network and in key capital projects,” Reidy said.

Kiwirail said the Interislander operation was working “effectively” since the retirement of Aratere to support the ferry replacement project.

“We have strengthened our road bridging capability to maintain the movement of rail freight across Cook Strait, increasing staffing and equipment at terminals,” Reidy said.

“While passenger numbers were lower due to the shift from three vessels to two, commercial freight volumes remained steady for the half year reflecting improved capacity utilisation.”

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/kiwirail-triples-its-half-year-earnings-as-demand-rises/

Source: Radio New Zealand

Benefit sanctions have not worked – probably largely because there are not enough jobs for beneficiaries to move into, one economist says.

Rob Heyes, principal consultant at Infometrics, has looked at the experience of benefit sanctions introduced in 2024.

The government introduced a traffic light system alongside financial and non-financial sanctions for beneficiaries who did not meet their obligations.

It affects people on JobSeeker Support or Sole Parent Support who have work obligations, like being prepared for work, and taking part in Work and Income assessments, or social obligations such as caring for children.

If beneficiaries do not meet their obligations without good reason, they are moved to “orange” in the system. If they do not then get back on track within five days, they are shifted to “red”, at which point their benefit can be stopped or reduced.

Non-financial sanctions include such things as going on a course, keeping a record of job searches, having some of their benefit put on a payment card or being sent on community work experience.

“The new, tougher policy towards beneficiaries has certainly increased the number of benefit sanctions. In the September 2024 quarter, just over 14,400 sanctions were imposed on beneficiaries compared with just under 10,400 in the June quarter and just 7500 in the March quarter. Bear in mind that the traffic light system was introduced in August 2024 – halfway through the September quarter,” Heyes said.

The number had since declined to 12,900 in the September quarter last year. That was still double the number of sanctions over the three years before the new system was introduced.

But Heyes said only 1 percent of total beneficiaries were in the red zone, and another 1 percent at orange. That had been consistent, he said.

“If you look at the proportion of beneficiaries that are either orange or red, it’s tiny and that’s not a measure of the effectiveness of the policy … it’s a relatively small number of people who are under sanctions. So, the effectiveness of sanctions in getting people into work is always going to be small.”

He said in the 15 months to 25 September, about two-thirds of sanctions were because people had not attended Work and Income appointments or appointments with another service provider, or because they were not preparing for work. A relatively small number were for people not participating in work, he said.

Three-quarters of those sanctioned had their benefit reduced.

But people aged 15 to 24 were over-represented, making up 46 percent of all sanctions despite being only 19 percent of beneficiaries.

Men were also more likely to be sanctioned, at 68 percent of sanctions and 45 percent of beneficiaries. Māori and Pacific people were also more frequently sanctioned.

“Young people, Māori, and Pacific people are already over-represented in beneficiary statistics, which alone makes them more likely to receive sanctions. Being over-represented in sanctions statistics is a double whammy,” Heyes said.

“I wouldn’t want to suggest Work and Income are targeting men and young people more than other groups… working through all of this, the conclusion I came to was that I do hope that certainly before the policy was implemented and maybe afterwards as well, that ministers or officials are sitting down and having conversations with Work and Income staff.

“If I was the minister, I’d be wanting to talk to people who are the other side of the glass in Work and Income, talking to beneficiaries and have that on the ground understanding of how it works and how these sanctions work. The quantitative analysis is all well and good, but talking about people’s lived experience and you need that kind of information, I think, to really understand the nuance of that policy.”

He said the government expected the sanctions to push people into work but jobs were scarce and there were concerns people could end up pushed into poor-quality work or out of the system and into worse poverty.

He said the Ministry of Social Development could not give data about people coming off sanctions and finding work because it could not link the sanction and the job.

“If it is difficult to track someone who enters work, it will be even harder to track other outcomes. If people sink further into poverty and more vulnerable circumstances, they are more likely to fall through the cracks and therefore not show up in any datasets.”

He said it was not the best time to have implemented this sort of policy.

“There simply aren’t a great deal of jobs for people to go into.

“When jobs start to appear, then it might be more effective. But as I say, the numbers that have been sanctioned are so small you probably wouldn’t see a big difference.”

The government set a target of 50,000 fewer people on JobSeeker Support by 2030, Heyes noted.

“Using the December 2023 quarter as its base, that’s a fall from 190,000 to 140,000. When the traffic light policy was introduced in the September 2024 quarter, the number of Jobseeker Support recipients had risen to just under 205,000 and by the September 2025 quarter, the number had risen again to 218,000.”

He said it could be argued that JobSeeker numbers would be even higher without sanctions “but that’s a hard sell when job vacancies are so scarce. I think it works best when the labour market is creating lots of jobs. You’ve got to strike a balance between pushing people too hard and not pushing them hard enough”.

“I think that JobSeekers do have obligations, they’re effectively earning a wage from the taxpayers. There are obligations and there’s not a sanction at the moment in New Zealand for not getting into work. It’s about looking for work. I’m reasonably comfortable with it.”

But he said it was worth considering whether financial sanctions were necessary when non-financial sanctions were available.

“You’ve got major charities like the Salvation Army saying people are coming to us who’ve had their benefits cut … that’s not really helping anyone.”

Social Development Minister Louise Upston has been approached for comment.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/have-benefit-sanctions-actually-worked/

Source: Radio New Zealand

Consumer confidence has dropped back from last month’s four-year high.

February’s ANZ-Roy Morgan Consumer Confidence index is well down from last month’s 107 points, but still remains in positive territory at 100 points. Anything under 100 is considered negative.

• Consumer Confidence falls to 100.1 points from 107.2 points in January
• A net negative 4 percent of households think it is a good time to make a major purchase
• Wellingtonians the most negative
• A net 20 percent expect to be better off this time next year, down from last month’s net 29 percent.

Confidence fell sharply in Wellington and Auckland and the mood has turned negative when it comes to feeling like it’s a good time to buy a major household item, though the reading was still well above last year’s levels.

ANZ chief economist Sharon Zollner said consumer confidence gave up much of its recent gains, with higher fixed mortgage rates and stubborn inflation weighing on sentiment.

“In a long-term historical comparison consumer confidence remains subdued, but one month of retracing a particularly sharp gain doesn’t mean the trend has changed,” she said.

“Recoveries seldom happen in a straight line and the upward trend across many of these indicators remains intact.

“While there is still residual support coming through from past monetary easing, stagnant house price momentum, a loose labour market, and lingering cost-of-living pressures mean it’s still tough going out there for many households.”

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/consumer-confidence-drops-again-after-four-year-high/

Source: Radio New Zealand

The government’s Bioeconomy Science Institute will cut 134 jobs less than a year after it was formed.

That comes on top of 152 jobs cut when the institute was set up as a merger of AgResearch, Manaaki Whenua – Landcare Research, Plant & Food Research and Scion into a single organisation.

The institute. formed in July and had a workforce of 2300.

The jobs being cut include 86 science roles and 48 professional services roles such as finance and administration.

Public Service Association (PSA) union national secretary Fleur Fitzsimons, said the government was wasting the talent of scientists who could drive economic growth.

“This is just more of the same from a government determined to shed talented people across the public sector regardless of the consequences.”

Fitzsimons said cuts would set the organisation up for failure.

“New Zealand deserves and needs this organisation to contribute to economic growth innovation, and our response to climate change.”

Fitzsimons said the cuts would also not help New Zealand’s productivity.

“The government’s own science system advisory group had warned them that the lack of investment in science, innovation and technology is playing a role in our sluggish productivity.”

The downsizing came after cuts to other crown research institutes, and the disbanding of callaghan innovation.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/newly-formed-bioeconomy-science-institute-to-cut-134-jobs/

Source: Radio New Zealand

Retirement village operator Summerset has posted a record underlying profit, although weaker property values weighed on its bottom line.

Key numbers for the year ended 31 December compared with a year ago:

• Net profit $259.7m v $332m
• Revenue $361.8m v $319.9m
• Underlying profit $234.2m v $206.4m
• Final dividend 13.2 cents per share

Summerset chief executive Scott Scoullar said the company’s strategy continued to deliver results, with underlying profit growth, strong sales and the company meeting its build targets.

“We’ve continued to achieve despite another year where the business environment and property market has been subdued,” he said.

The company sold a record 1560 homes during the year – 805 new sales and 755 resales, with a focus on selling down stock at two major developments: Summerset Boulcott in Lower Hutt and Summerset St Johns in Auckland.

Both were among the company’s top‑performing new‑sales villages.

“Boulcott and St Johns are unique villages for us, due to the land and style of build we delivered large numbers of new homes at once,” he said.

“Selling these down has been a priority this year and we’re pleased to see both villages performing well.”

Sales of care suites also boosted results, with care operating profit rising to $18.8 million, up from $2.7m the previous year.

Summerset delivered 637 homes in New Zealand and 56 in Australia, in line with guidance, and was currently building on 22 sites in both countries.

Progress in Australia

Scoullar said the company continued its measured and deliberate growth plan in Australia and was now gaining momentum.

“We delivered our first village centre building at Cranbourne North in Victoria, marking a key milestone as we prepare to deliver aged care for the first time in Australia.”

It was building two villages in Victoria state and seeking planning permission for a third.

Summerset did not provide earnings guidance for 2026, but Scoullar remained optimistic about demand in both markets.

“Even in constrained trading conditions we have continued to see extremely high demand, record sales numbers and have continued to deliver on our expected build rate in both Australia and New Zealand.”

He said the company had continued to reduce debt and intended to keep strengthening its balance sheet in the coming year.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/summerset-reports-record-underlying-profit-lower-net-profit-on-valuations/

Source: Radio New Zealand

Higher cargo volumes driven by a rebound in imports have delivered a strong half-year profit for the country’s biggest port.

Key numbers for the six months ended December compared with a year ago:

• Net profit $70.2 million vs $60.2m
• Revenue $244m vs $225m
• Cargo vols 12.6m tonnes vs 12.4m tonnes
• Forecast FY underlying profit between $142m-152m vs actual 2025 $126m
• Interim dividend 8 cents per share vs 7 cps

Port of Tauranga chairperson Julia Hoare said the result had been achieved through operational efficiency and control of costs, as a rise in imports made up for a dip in export trade.

“Export volumes were affected by subdued export log demand and a later-than-usual start to the dairy export season, this was offset by strong import demand and improved performance across our subsidiary and joint venture businesses.”

Cargo volumes rose just over 1 percent, with the number of containers handled up nearly 3 percent.

Export volumes were down slightly because of a late start to the dairy season and lower logs exports, but the improving economy drove an increase in imports.

The port’s various subsidiaries including interests in the Timaru Port, Northport, inland cargo handling hubs and logistics, increased their contributions by more than a quarter to $6.2m.

Chief executive Leonard Sampson said the port was putting much effort into improving its resilience and efficiency.

“We are investing in capacity, improving productivity and service delivery to our customers, as well as expanding our network to prepare for future growth.”

That included faster handling of containers, automating some functions, along with ordering equipment and tugs, and dredging the harbour to handle bigger ships in the future.

The port expected a continuation of the first half’s momentum into the rest of the year.

“The later start to the dairy export season, combined with a strong kiwifruit export season from March, is expected to support continued strong volumes in the second half of the financial year.”

Meanwhile, the company has been fast tracked for a consent hearing for a new container berth and is waiting for a hearing.

Sampson said the port was into its seventh year in the planning process to get the Stella Passage project approved and the delay has forced the port to turn away shipping services which would have saved businesses tens of millions of dollars.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/port-of-tauranga-delivers-70-2-million-half-year-profit/

Source: Radio New Zealand

Biddy Tai Ahmu says bariatric surgery in Turkey, funded with money withdrawn from her KiwiSaver, saved her life.

She had the surgery three years ago after being on the waiting list in New Zealand for years. Diabetes was a problem in her family and, having seen it kill two grandmothers and watching her mother battle it, she knew she needed to do something.

“If I didn’t do something I was going to die.”

Her GP was supportive and she made an application to her KiwiSaver provider, which was approved. The procedure meant she was now not diabetic any longer.

She had started a Facebook page, I left my stomach in Turkey, to share her story to help others. It now has about 7000 members. Many wanted to be able to tap into their KiwiSaver accounts to fund the surgery, too.

She said the bar seemed to be shifting and providers were putting more hurdles in place for people to access their money. “It’s really unfair. If your GP says it’s going to save your life, what’s the problem? It should be a no-brainer.”

She said New Zealand did not have enough space in the public system to help people with diabetes or obesity to get the treatment they needed. “The government needs to look at that so people don’t need to go overseas.

“A lot of people are against people doing this and they shouldn’t be. I have six children and three grandchildren and if I didn’t do it, I would be dead. KiwiSaver providers need to understand that and have a bit more empathy.”

She said many people contemplating surgery were trying to support families and dealing with rising costs for other essentials, like food.

Most common reason

A debt solutions charity that helps six KiwiSaver providers, including Milford Asset Management and Simplicity, with their hardship withdrawal applications said bariatric surgery was now the most common reason that people applied for their money.

Debtfix chief executive Christine Liggins said the top three reasons she saw for hardship withdrawals were bariatric surgery, a new car and the cost of living.

The number of people seeking to withdraw money from KiwiSaver on hardship grounds had increased sharply in recent years, to almost 60,000 last year.

Withdrawals for bariatric surgery would usually only be possible under significant financial hardship grounds, if it was needed to treat a medical condition and people did not have another way to pay for it.

“We know there’s a problem with bariatric surgery in New Zealand.”

She said Debtfix was working to compile data so it could show the government the problem.

“We can say, there’s a problem with health here. We need to be addressing it over there. And then it doesn’t come back and bite us when they turn 65 and they’ve no money … we need some cross party conversations and decisions so that we can actually preserve KiwiSaver for people’s retirement and not doing the here and now.”

She said it was rare to see requests for other surgeries.

“I think we just need to get a few people around and talk about hardship and how we can reduce the number of hardships, but also make hardship withdrawals actually work better for the people experiencing hardship.”

Rupert Carlyon, founder of Koura KiwiSaver, said there was “clearly interest” in borrowing for bariatric surgery.

The scheme had had a few people asking questions recently, he said. “We haven’t paid one out.”

He said it was driven by social media and people on platforms like TikTok talking about what people needed to do to get their money out.

Kernel founder Dean Anderson said he was aware some KiwiSaver members tried to “shop around” providers to find one that would give them access.

A spokesperson for Public Trust, a supervisor for many KiwiSaver schemes, said people should talk to their KiwiSaver providers or other trusted sources of information for guidance on applying for medical costs.

“When we look at the cases we see as a supervisor, surgery and medical care are cited in a relatively small number of financial hardship applications that come to us for assessment. “

Tai Ahmu said it was important that Polynesian people in particular felt able to make their health a priority “to be there more for their grandchildren”.

She said the government and KiwiSaver providers needed to recognise the importance of whakapapa and support for people seeking help.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/kiwisaver-withdrawal-funded-life-saving-weight-loss-surgery/

Source: Radio New Zealand

Housing market confidence continues to improve, though house price growth is expected to remain subdued.

“Indeed, we anticipate only muted house price growth in 2026. High inventory levels and some headwinds for housing demand are likely to temper house price growth,” the latest ASB Housing Confidence report said.

ASB chief economist Nick Tuffley said the results suggested confidence had moved past its weakest point, even if a strong price upswing was unlikely.

“House price expectations have clearly rebounded after a soft patch through 2025,” Tuffley said.

“However, high levels of housing supply and only moderate demand are likely to keep price increases relatively subdued through the first half of 2026.”

He said the outlook on interest rates was another reason why price growth would remain in check.

“With inflation ending 2025 above the Reserve Bank’s target band and mortgage rates already edging higher, people are now anticipating further increases this year,” Tuffley said.

“The switch over the quarter to fewer people expecting declining rates and more expecting higher rates was marked.”

However, the survey found rising optimism throughout the country, led by the South Island with a net 36 percent expecting house prices to rise over the coming year.

Auckland recorded the largest quarterly improvement, with net house price optimism rising to 33 percent.

“From a buyer’s perspective, prices are stable, supply is at a 10-year high and mortgage rates are still relatively low,” Tuffley said.

“However, rising expectations for both house prices and interest rates could prompt some buyers who have been sitting on the sidelines to act sooner rather than later, to avoid getting priced out.”

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/27/housing-market-confidence-improves-house-price-growth-expected-to-remain-subdued/

Source: Radio New Zealand

Air New Zealand chief executive says the airline has been dealt ‘tough cards’ and New Zealand First leader Winston Peters says the government should be backing the airline’s future but the Deputy Prime Minister continues to question their priorities.

The airline’s CEO Nikhil Ravishankar is carrying out a strategic review in the face of rising costs and told Checkpoint the airline is designed to grow but that hasn’t happened.

“The airline is designed to grow and for the last six years, we haven’t been able to do that.”

This comes after Deputy Prime Minister David Seymour earlier renewed his call for the government to sell its 51 percent stake in Air New Zealand after it reported a significant half-year loss.

The national carrier posted a $40 million loss for the six months ended December compared to a $106 million profit for the same period the year before.

The airline is still blaming severe disruption caused by delays to unscheduled engine maintenance grounding up to eight planes, as well as fuel and operating costs.

Seymour told Checkpoint the airline has placed too much “emphasis on politics” and is not reliable or affordable.

“The drumbeat of frustration from New Zealanders who are saying, look, we’re generally frustrated with the idea that things don’t work and cost too much,”

“And it seems that its distractions into various political projects over the last few years has started to come home to roost.”

New Zealand First leader Winston Peters said in a social media post calls for the government to sell its shares in Air New Zealand while the airline market is in a downturn is economic lunacy.

Peters said the airline needs to start being on-time, and getting regional costs down. He said as the majority shareholder, the government should be backing its future rather than dragging it down, and hocking it off.

In response to the high costs of tickets Ravishankar said they are the result of increasing costs especially in fuel prices and engine maintenance.

However, Ravishankar told Checkpoint he was confident customers are not bearing the full weight of inflation when buying tickets.

“Since 2019 the cost that the airline bears has gone up north of 40 percent and our domestic airfares have gone up 32 percent.

“If you compare that with general CPI, general inflation, which has been around 29, 30 percent our fares have gone up a couple of percent over inflation, but our costs have gone up significantly more than that.”

When it came to Seymour’s comments that the airline was focusing on the wrong things such as electric planes and climate change reports, Ravishankar said he believed the airline was focused on the right things.

“It’s not distracting us from focusing on what’s important to our customers, which first and foremost is safe, reliable, and on-time performance, and that’s what we’re focused on delivering.”

“We are an airline that is globally extremely well-respected and people in the industry realise the tough cards we’ve been dealt.”

Ravishankar said matters of ownership were not for him to comment on as that was a question for the airline’s board.

Seymour has in turn said that many airlines have faced high costs and challenges especially after Covid.

“People are shopping around and finding that they can do better with the competitor… it seems that in the rest of the world, they have managed to navigate the challenges more competently.”

“And my charge is that if Air New Zealand was not distracted by its various projects of trying to become a biofuel producer, for example, they might be focussing more on taking off and landing on time.”

Ravishankar was currently carrying out a strategic review, which he said was drive by issues such as rising costs and falling profits.

“We need to tighten our belts and also in terms of looking into our capital management framework.”

Air New Zealand is also expecting to receive two of its 10 new 787 aircraft by the end of June, providing widebody capacity growth of 20-25 percent over the next two years.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand

LiveNews: https://nz.mil-osi.com/2026/02/26/air-new-zealand-ceo-says-airline-was-dealt-tough-cards-as-seymour-calls-government-to-sell-stakes/

Source: Radio New Zealand

Another bank has adjusted down its long-term rates, but borrowers deciding whether to take a longer term will need to weigh up a few factors.

BNZ said it was reducing its three-year rate by 10 basis points to 4.99 percent, its four-year rate by 36 basis points to 5.19 percent and its five-year rate by 40 basis points to 5.29 percent.

It comes after Westpac last week said it was trimming the same terms.

It was the first bank to move after the latest official cash rate (OCR) announcement.

The Reserve Bank indicated it expected to raise interest rates a little faster and earlier than previously forecast – but not as quickly as markets had priced in.

Wholesale markets fell as a result.

Commentators said it could be good news for borrowers and should mean a temporary end to the increases in home loan rates seen in recent weeks.

Mortgage adviser Glen McLeod, head of Link Advisory said, with longer term rates starting to come back down, he was beginning to see more interest in longer term fixed rates, but it was still a relatively small portion of clients.

“Part of my role as an adviser is to explain the pros and cons of where those rates currently sit and how suitable each option is for an individual client. I talk clients through what each rate term could mean in the current environment, where we are in the interest rate cycle, and what is likely to happen based on the best economic information available.

“From there, I look at different borrowing strategies and match them to the client’s goals. The key thing is ensuring clients fully understand the risks and what they are ultimately signing up for. Longer term rates can be appropriate in some situations, but it really depends on the person’s circumstances and risk profile.”

ANZ said in its latest Property Focus report that it was worth remembering that all rates out to two years are now below 5 percent whereas in late 2023 they were all above 7 percent.

“Given that, and our expectation that the next move in the OCR is likely to be up, we still see merit in fixing for longer at current rates, with the 18-month to three-year part of the mortgage curve likely appealing to many borrowers.”

They said four- and five-year rates were above where they expected one- to three-year rates to top out next year.

“From a pure cost perspective (that is, disregarding the value of certainty), one might only be inclined to fix for four or five years if you expect one- to three-year rates to rise above 6 percent over the next two to three years.

“That is possible, but it is not what we expect. Taking all of that into consideration, the 18-month to three-year part of the curve looks like the sweet spot, offering a good mix of certainty and low cost.”

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LiveNews: https://nz.mil-osi.com/2026/02/26/another-bank-cuts-rates-but-should-you-take-them/