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When the bank lifted the benchmark rate the price of mortgages went up, when it cut, they went down. It has been the same with the interest on deposits.In theory, a cut in the official cash rate (OCR) means it is cheaper for the banks to borrow money, and this would usually be followed practically immediately in lower floating mortgage rates, and a cut in interest paid to depositors.
When the Reserve Bank took action, the amount of money in the economy moved accordingly, as household incomes changed. This has made the Reserve Bank governor one of the most powerful people in New Zealand.
This time though, almost the complete reverse appears to be taking place.
Cameron Bagrie, the chief executive of New Zealand's largest bank, ANZ, had already warned on Monday that little of the savings from a cut would go to mortgage holders and bizarrely, deposit rates may climb.
Within minutes of the Reserve Bank cutting the OCR by 0.25 percentage points to 2 per cent, ANZ New Zealand chief executive David Hisco announced that he was going to raise the interest rate on deposits by 0.3 percentage points.
The interest rate on ANZ's floating mortgage was dropping, but by just a fifth of the amount Wheeler cut the OCR.
While the other banks are yet to announce changes to their pricing, there is every reason to expect they will take similar steps.
In March none of the major banks passed on the full cut in the OCR.
While that appeared to be a bid to protect their margins and profitability, ANZ's move to raise deposits rates marks an important change, and is likely to spark a new battle to win the favour of savers.
So does the Reserve Bank no longer control interest rates?
As the governor of the central bank Graeme Wheeler said when asked if he expected the full amount of Thursday's cut in the OCR to be passed on to borrowers, or savers, these are unusual times.
"It's complicated."
Eventually Wheeler told journalists that the Reserve Bank would "like" to see the bank pass on lower borrowing costs to customers, but he wouldn't like the central bank to be telling the banks what to charge.
The reason the interest rates regular customers see have disengaged from the OCR is actually not all that complicated.
A large chunk of the money banks use to lend comes from global financial markets, and another chunk is from everyday savers.
Financial markets are currently experiencing extraordinarily unusual conditions. As Wheeler put it today, countries responsible for about a quarter of global economic output have negative interest rates.
In simple terms, if you want to lend money to the Japanese government, they will effectively charge you a fee to do so.
While the interest rates on offer in New Zealand look much more attractive, nervousness about the global economy mean when the banks try to borrow money, they are paying more to do so than they were a year ago. This cost impacts what they lend at.
The equation is similar for local deposits. The Reserve Bank expects the bank to keep a chunk of money in the form of local deposits, as this money is less likely to flee suddenly if financial markets lose interest in New Zealand, which has happened in the past.
But, as ANZ's Bagrie put it on Monday, the banks have to give savers a reason not to simply keep their money under the mattress.
"At some point you get these rates down so low, people just think 'i've got to do something else with my money'."
Bagrie also said this week that with interest rates as low as they are, the impact of cuts is one of diminishing returns.
Try as Wheeler might to create inflation with lower interest rates, when he did so on Thursday, the New Zealand dollar jumped, and real world interest rates effectively rose.
The risk is Wheeler has become powerless to do what we used to see at the governor's job, to control spending.
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