According to analysts at ANZ, New Zealand economy’s annual growth with a 3-handle over the next couple of years looks a stretch after the economy has had a good run in recent past.
“Momentum has slowed, and it’s likely this process has further to run as the drivers of growth continue to become less synchronised. Adding to the list of headwinds, confirmed and probable changes to bank capital requirements suggest financial conditions will gradually tighten.”
“All up, slowing growth in the context of inflation that’s still shy of the RBNZ’s target midpoint means the case for a little extra monetary stimulus will become evident. We expect the RBNZ’s next move will be a cut.”