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Dominick Stephens, Chief Economist at Westpac, points out that the RBNZ has moved away from the idea of cutting the OCR by removing the phrase that the next move in the OCR could be “up or down.”

Key Quotes

“But the RBNZ also made it clear that hikes are not expected until mid-2020.”

“The Monetary Policy Statement acknowledged stronger signs of inflation pressure, but kept the OCR forecast unchanged.”

“Extraordinarily, the RBNZ is forecasting that inflation and employment will overshoot the targets in the medium term, yet it is not planning to remedy that by raising the OCR.”

“This could become a theme – strong data but a Reserve Bank that declines to forecast a rising  OCR.”

“The “new” Reserve Bank is more dovish than the old.”