With the market being so flat at present, it is unlikely that motor vehicle financiers will move dealer base rates as a result of the increase in the OCR, for fear of losing business.

This is the opinion of Steve Wilkinson,  general manager sales and lending for Geneva Finance.

"The OCR increase has been widely predicted and in isolation will have little effect," Wilkinson adds.

The good news for dealers is that interest rates are not now expected to rise as quickly or to the heights that were being predicted a few months ago.

Koon Goh, head of market economics and strategy for the ANZ Bank comments:

The Reseve Bank increased the OCR by 0.25% yesterday to 3% as expected.

But while sticking to their “removal of monetary policy stimulus” script, the tone is a bit more downbeat compared to the bank's June assessment.

The Reserve Bank noted numerous downside risks: “future prospects for (global) growth have deteriorated”, “domestic demand is subdued”, “slowing net migration will act to further dampen consumer spending”.  However, these are still couched within a view of “respectable near-term GDP growth”, somewhat more sedate than the “broad-based” recovery they expressed in June.

The Reserve Bank is now indicating that the pace and extent of further OCR increases will be more moderate than their June projections (which had the 90-day rising towards 6.1% by late 2012).

We believe a hike in September is still odds-on, but ascribe only a 60% chance on it.  We remain of the view that the fourth quarter will see a pause in the tightening cycle.  This seems to correctly balance the softening seen of late and the risk profile, against a taut rubber band in terms of where the OCR sits relative to neutral.

"The OCR is still biased upwards over time.  But the path to normalisation will be a staggered and elongated one", says Goh.