According to analysts at ANZ, the RBNZ’s Monetary Policy Statement will take centre stage this week and while developments have been a mixed bag since the August Statement, but ANZ expects the RBNZ will remain cautious about the medium-term outlook and reassert a dovish tone.
“Labour market data also out this week is expected to show a stable, tight labour market, providing continued support to household spending. So far, the household sector has been fairly resilient to the headwinds facing the economy, but our latest ANZ-Roy Morgan Consumer Confidence Survey shows that households are feeling a bit warier about the future.”
“Going forward, we expect that consumption will remain firm, supporting growth. But with businesses and even the RBNZ circumspect about the future, wariness may be here to stay – meaning household retrenchment is a key risk. There’s a slew of other data out this week, including a GlobalDairyTrade auction, with a further fall in dairy prices expected.”