Recently, I noticed an interesting development from central banks. ANZ Bank has just released its latest forecasts for the Reserve Bank of New Zealand’s policy, and they believe a run of consecutive rate hikes is coming next.

Specifically, ANZ expects the Reserve Bank of New Zealand to raise interest rates three times in July, September, and October consecutively—each time by 25 basis points—ultimately pushing the official cash rate up to 3%. This round of rate hikes is actually quite substantial.

ANZ’s Chief Economist, Sharon Zornes, is an interpretation that’s well worth paying attention to. She believes this pace of rate hikes will be very strong, so the bank has adjusted its expectations—not anymore viewing it as necessary to raise the rate to 3.5%. She said that once the rate is raised to 3%, it will remain unchanged at that level.

The logic behind it is also pretty easy to understand. As inflationary pressures continue, if interest rates are still kept at stimulative levels, the Reserve Bank of New Zealand will definitely be unable to sit still. So, this rate-hike cycle appears to be preparing for a cooling of the economy. For those who pay attention to central bank policies and the monetary environment, this signal is still quite important.