Via a note from analysts at KiwiBank, their outlook for the Reserve Bank of New Zealand.
In (very) brief summary from the note:
- The RBNZ ... cash rate was left unchanged at 5.5%.
- The OCR track however was more hawkish than we had hoped. We were surprised to see the entire track lifted out to 2026. ... the door is open to another interest rate hike.
- Firstly, the RBNZ want the full force of recent tightening to hit households in coming months. Thoughts of rate cuts were deliberately squashed, in order to keep wholesale rates, and therefore mortgage and other lending rates, high and dry.
- We still expect the next move to be a rate cut. And we expect a cut long before most commentators and the RBNZ themselves. We now pencil in the first cut in May next year.
NZD/USD update, China developments are amongst the factors weighing on the Kiwi $:
