RBNZ: OCR on hold – Westpac

Dominick Stephens, chief economist at Westpac, notes that the Reserve Bank of New Zealand left the OCR unchanged at 1.5% at its June OCR Review and strongly hinted that it could reduce the OCR to 1.25%.

Key Quotes

“It said that a lower OCR “may be needed” or “was likely” in different parts of the document.”

“This was very blunt language, and is a strong signal for a cut in the future.”

“The RBNZ remains mainly focussed on the global economy, and particularly the trend towards lower interest rates at overseas central banks. It is more ambivalent about the domestic economy.”

“We remain happy to forecast an OCR cut at the August MPS meeting.”