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RBNZ OCR Preview: Likely to hold fire this time – ANZ

FXStreet (Delhi) – Research Team at ANZ, suggest that after three consecutive cuts, we expect the RBNZ to leave the OCR at 2.75% on Thursday and even though we still have another OCR cut pencilled in, but expect this further down the track.

Key Quotes

“A sub 2% inflation outlook would normally demand a tweak lower, but there are enough signs from housing and support from the 75bps of OCR cuts delivered thus far to encourage a pause.”

“Market attention will fixate on the term “likely” in the policy statement as a pointer for policy going forward. While we’re somewhat agnostic on it remaining, we expect the RBNZ to include more direct reference to the NZD as influencing the monetary policy outlook.”

“Even if the RBNZ delivers, direction still depends on the FOMC (who have concerns over USD strength), the BoJ (who may provide further stimulus), and finally China who present their five year economic plan this week. We continue to see NZD as extended both against USD and versus the TWI, but the potential for squeezes topside remain non-trivial.”

Check here for the latest article on RBNZ – “NZD: RBNZ to take dovish stance and leave rates unchanged – BNZ

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