In the wake of the big negative inflation print in New Zealand this morning, changes in bank analysis

  • RBC looking for the Reserve Bank of New Zealand to cut the official cash rate to 2% by the middle of the year

(RBNZ have the OCR currently at 2.5%)

Meanwhile, ASB (who I've already referred to this morning on their dairy price commentary) say that:

  • We expect further rates cuts from the RBNZ in June and August, although now the risk is the RBNZ cuts earlier than this.

(bolding is mine)

On the CPI, ASB:

  • The CPI fell by much more than expected in Q4
  • Annual inflation now at the lowest rate since September 1999
  • Strong retail competition and discounting are muting the inflationary impact of the lower NZD