The Reserve Bank's continuing to walk a fine line, with its move to cut the OCR 50-basis points to 2.5%.

Economic data suggests inflation has now hit 3%.

Finance Minister Nicola Willis is blaming rising rates, saying they’re having a disproportionate impact on overall inflation, whereas other sectors are stabilising.

NZ Herald Business Editor Liam Dann told Kerre Woodham we almost seem to be in a self-fulfilling negative spiral.

He says we should be feeling better, but we aren't, and then we start questioning ourselves and the economy.

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The biggest upshot of the latest OCR cut is likely to be the boost to consumer confidence.

The Reserve Bank's slashed the cash rate by 50-basis-points to 2.5%.

Major banks are responding by lowering floating and flexible rates after already lowering their fixed-term rates in recent days.

ABC Business Sales Chief Executive Chris Small told Mike Hosking businesses will benefit more indirectly from increased consumer spending, than directly from falling interest rates.

He says interest costs are only a small portion of a person's actual business costs, and businesses will always prefer for revenues to rise than for costs to fall.

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The Reserve Bank today slashed the OCR by 50 basis points to 2.5 percent, prompting markets to make readjustments.

This recent cut wasn't full priced in, and it's got some experts re-thinking their OCR outlooks ahead of the end of the year.

Milford Asset Management's Remy Morgan explains further.

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