NZD traders - RBNZ preview (Reserve Bank of New Zealand monetary policy meeting next week)

RBNZ monetary policy decision, Monetary Policy Statement, and Governor Orr's media conference is on May 8.

Earlier preview posted:

• One for the NZD traders - RBNZ meet next week - preview

And, ICYMI, this is the first RBNZ policy decision by committee:

• Here are all the new RBNZ monetary policy committee members

In summary from Capital Economics' preview:

• We expect the recent string of soft economic data will be enough for the Reserve Bank of New Zealand (RBNZ) to cut rates to 1.50% when it meets next week on Wednesday 8th May.
• Since the RBNZ shifted to an easing bias in March the economic data have remained generally subdued, supporting the case for a rate cut. And we suspect that a rising unemployment rate and subdued underlying inflation in 2019 will force the Bank to cut rates again in November.

CE add in a little on the arrangements at the RBNZ:

• this meeting is the first under the new structure of the monetary policy committee. We don't expect the new committee members or structure to make any significant differences to the future direction of monetary policy. But the release of the meeting minutes and the non-attributed record of any votes taken should make the RBNZ's position a little more transparent.

A contrary view from BNZ, analysis following the jobs market data:

• The weaker labour market data, plus the CPI data, will almost certainly increase the Reserve Bank's discussion around the possibility of a rate cut. However, from our perspective the data are not soft enough for that to happen at next week's MPS.
• If the Bank is to be pushed over the edge, we think that waiting until August would be a wiser option. After all, there is no urgency to move. There is no sign that the economy is about to tank any time soon, interest rate settings are already highly stimulatory and there is still risk on the other side of the equation, i.e inflation pressures are still there in spades.