According to analysts at ANZ, the RBNZ Monetary Policy Statement is this week’s headline act.
“Since November, the labour market has flat-lined and the growth outlook has a duller pitch, though domestic inflation has been a little stronger. Global data has struck a softer note and risks have increased sharply, with central banks turning more dovish in concert.”
“We expect the RBNZ will join the chorus this week, employing a similarly dovish tone that echoes the tenor of other central banks and market pricing, which has moved to price in a good chance of a rate cut, reflecting the changing balance of risks. That said, a dovish stance so soon from the RBNZ is not a necessary ingredient of our November cut call.”
“The data and market pricing may well strike higher and lower notes, but we think the case for more monetary stimulus will become evident in time.”