The Reserve Bank is coming under increasing pressure to drop the official cash rate at this week's meeting.
A Reuters poll suggests economists are picking the central bank will cut interest rates, and last week the Prime Minister, John Key, said he too expects the rate will be lowered.
If cut by 50 basis points, the OCR would drop to 2.5%, the rate it was in June last year
ASB chief economist Nick Tuffley believes Reserve Bank Governor Allan Bollard will cut interest rates.
"The issues for doing it are not just about the earthquake, interest rates are pretty blunt instruments so they're not going to provide the targeted assistance that Government assistance and bank assistance to customers can do," he said.
"But what interest rates can do is provide the economy with some assistance at a time when the underlying economy was already weak. This event is very severe, causing a huge amount of disruption to the Christchurch economy and there is that chance we will get ripple effects elsewhere."
But the head of Asia Pacific research for TD Securities, Annette Beacher, says she hopes the Reserve Bank will hold the cash rate.
"I feel that natural disasters should not be linked to monetary policy. As bad as the Christchurch earthquake is I think natural disasters should be dealt with by fiscal policy."