RBNZ: We’re not going anywhere - Westpac

Analysts at Westpac explain that the Reserve Bank of New Zealand left the Official Cash Rate on hold at its May policy review, however, the accompanying policy statement and interest rate projection were a bit more dovish than Westpac and markets had been expecting.

Key Quotes

“The RBNZ also concluded that developments since the February Monetary Policy Statement have been neutral for monetary policy. Consequently, they kept the projected path for the OCR unchanged, with no rise in the OCR factored in until late-2019. We and the market had expected the RBNZ to signal an earlier start to interest rate hikes.”

“We still think that OCR hikes will be later than financial markets are pricing (first half of 2018), but earlier than the RBNZ has signalled (late 2019).”