Market & Portfolio Update: July 2026
Early in the month, renewed tension in the Middle East briefly pushed Brent crude oil above US$100 a barrel, which lifted energy prices and brought inflation concerns back into focus.
Later in the month, attention shifted back to company earnings and the large amount of spending going into artificial intelligence. Some technology shares came under pressure, especially semiconductor companies, as investors questioned whether the rapid growth and heavy investment seen across the AI sector could be sustained.
In the United States, the Federal Reserve kept its key interest rate unchanged at a range of 3.50% to 3.75% at its 29 July meeting. The decision was not unanimous, with three members voting for a 0.25 percentage point increase because of inflation concerns.
Closer to home, the Reserve Bank of New Zealand raised the Official Cash Rate from 2.25% to 2.50% on 8 July, its first hike in three years. Annual consumer price inflation, sitting above the RBNZ’s 1-3% target range at 4.1%, was a key factor in the decision.
Lifetime Book Club: Paradox of Choice by Barry Schwartz
In The Paradox of Choice, psychologist Barry Schwartz explores a curious feature of modern life: while freedom and choice are undoubtedly valuable, there can come a point where having more options makes decisions harder, increases our expectations and leaves us questioning whether we made the right choice at all.
From what to buy and where to eat to decisions about careers, relationships and money, Schwartz looks at the hidden mental cost of constantly comparing our options – and makes the case that sometimes, simplifying our choices can leave us better off.
Interest rates on the move again.
Just when it looked like interest rates were heading in one direction, the picture has changed again.
After a period of falling rates, the Reserve Bank of New Zealand (RBNZ) increased the Official Cash Rate (OCR) from 2.25% to 2.50% in July, its first increase in three years.
For homeowners and prospective buyers, it is a useful reminder that interest rates do not always move in a straight line. More importantly, it highlights why having the right mortgage structure can matter just as much as securing a competitive rate.