Reserve Bank of New Zealand meet today – BNZ calls for an immediate rate cut

The Reserve Bank of New Zealand meets at 0200 GMT on Wednesday, which is 2200 EST on Tuesday evening.

Previous Previews:

• RBNZ Monetary Policy Meeting – Reuters poll inconclusive, 19 say hold, 12 say 25bp cut
• ANZ expects the Reserve Bank of New Zealand to hold interest rates steady next week, hinting at rate cuts later in the year
• NZD traders – Westpac expects the Reserve Bank of New Zealand to cut interest rates by 25 basis points in October and November 2024

• New Zealand – RBNZ board split on rate cut

Via BNZ, Frank Opinions:

• Easing is ‘already overdue’, say National Bank of New Zealand economists
• Economy ‘collapses’ amid tough conditions, declining immigration and government cuts
• Recent data shows manufacturing/services PMIs at GFC levels, retail spending down, job postings down
• Inflation ‘behaving normally’ now – June CPI comes in 0.3% below RBNZ forecast
• The Bank of New Zealand expects a 25 basis point rate cut in August, followed by successive cuts to a record low of 2.75%.
• He warns that delay could lead to “unnecessary volatility in output and interest rates.”
• Stock market rates more aggressive – 100 basis point cuts by November
• The Reserve Bank of New Zealand is expected to remove tightening bias, deliver a first major cut.
• But he warns that the RBNZ’s “tendency to surprise” creates uncertainty.

Key takeaways from this report: NBNZ sees risks to delay rather than early action. Market pricing appears overly aggressive in the near term.

This article was written by Eamonn Sheridan on www.forexlive.com.