RBNZ: Expect a further 25bp cut in the OCR in November - Westpac

Sean Callow, Research Analyst at Westpac, notes that the RBNZ reduced the Official Cash Rate by 25bps in August to a record low of 2%.

Key Quotes

“They also signalled that another rate cut is likely, saying that "further policy easing will be required to ensure that future inflation settles near the middle of the target range”.

Our economics team in Auckland expects a further 25bp cut in the OCR in November, which will take it to a low of 1.75%. While there is the possibility of a cut at the 22 September OCR review, we think this is less likely given continued relatively firm GDP growth and only limited new information before the September meeting.

The strength of the NZ dollar will be a key factor affecting the stance of monetary policy.”