It looks like low inflation could keep interest rates where they are.

Fixed term rates are already on their way down with many lenders, due to the inflation outlook.

Reserve Bank Governor Graeme Wheeler is scheduled to make an OCR announcement tomorrow.

New Zealand Institute of Economic Research principal economist Dr Kirdan Lees says inflation globally is at very low levels.

"Firms are certainly finding it very hard to pass on price increases on to consumers and that outlook really says, 'look interest rates are in a very low environment globally'."

Dr Lees says a more pessimistic global outlook is also having an effect.

"And that means that commodity prices are falling, and of course that's taking some of the pressure off the exchange rate."

Dr Lees says flat business confidence and a cooler housing market are helping inflation remain low.