Responses to the RBNZ statement - "surprised the market"
A snippet from Westpac's assessment of the Reserve Bank of New Zealand today.
RBNZ … signalled it is unlikely to cut again unless the coronavirus pandemic impact becomes more severe than expected.
- That surprised the market which had expected an easing bias to be retained.
- a hawkish shift from the guidance provided in November
- effectively signalling the easing cycle is over. Indeed, it forecasts one hike by late 2021.
RBNZ cited fiscal policy very prominently as a reason for the change in monetary policy outlook
- RBNZ leaves cash rate on hold as expected
- NZD jump on the RBNZ statement - the Bank do not forecast any rate cut this year
Next up is Governor Orr's press conference