RBNZ likely to cut 25bps – RBC CM

Research Team at RBC Capital Markets, expects the RBNZ to cut 25bps, as flagged by its recent communication, largely priced by markets and almost universally expected by analysts.

Key Quotes

“Inflation continues to undershoot and the removal of spare capacity remains gradual. The more interesting debate is around what happens beyond here. Export prices are improving and the housing market remains resilient. While the RBNZ will be wary of signaling any end to this cycle, there may also be limited hint in the communication to support our view of an eventual 1.50% OCR.”