More on that change of RBNZ forecast from Westpac (now expecting a rate cut tomorrow)

Author: Eamonn Sheridan | Category: Central Banks

The earlier info this Reserve Bank of New Zealand  projection is here: 

It is in response to the further fall in inflation expectations in NZ:
Which has weighed on the kiwi $ today:
OK …. back to Westpac:
  • "Our suspicion was that the survey would rebound, as the data are often volatile quarter to quarter. The fact that expectations actually fell further will be quite concerning to the Reserve Bank, increasing the chance that they will cut the OCR tomorrow" 
  • expect no explicit signal of future follow-up cuts ... but …. "However, we would expect the RBNZ to remain open to the possibility of further cuts with a phrase like 'There is scope for further fiscal and monetary easing if necessary"' "
Westpac expect this'll be last cut in the cycle, RBNZ on hold in 2020 and thoruhg 2021

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