From the New Zealand’s Interest.co website (bolding is mine):
- Westpac economists were expecting a further quarter of a percentage point rise in the Official Cash Rate (to 3.25%) next week on top of the rises in March and April
- They also expected the RBNZ to reiterate its plans to follow up with further OCR hikes this year and next
- “The RBNZ may sound a touch less adamant about the pace and extent of hikes than it was in the March MPS – but only a touch.
- “Markets are expecting a more radical downgrade to the RBNZ’s planned hiking cycle, and may be quite surprised by this MPS.
- “If we are correct, swap rates and the exchange rate will rise on the day,” Stephens said.
- “Financial markets seem to be awaiting a much more radical change of tone. We suspect that one of the RBNZ’s key aims next week will be to bring errant financial market pricing back into line with its own thinking – an exercise that can be like herding cats.”
- Stephens said in the assessment of Westpac economists, the RBNZ will deliver an OCR hike next week, and will firmly reiterate the case of OCR hikes in the accompanying Monetary Policy Statement.
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The NZD seems to have been paying attention to this, its ground it way about 20 points higher in the past hours
