Market pricing calls Westpac’s bluff

(Image: Getty)

Tue, 16 May 2023

The market isn’t buying Westpac Bank’s call that New Zealand’s official cash rate could peak at 6.0% and stay there until mid-2024. The market is pricing in another 25-basis point rate hike next week – to 5.5% – but the buck really stops there.According to Westpac Bank’s chief economist, Kelly Eckhold, the Reserve Bank of NZ (RBNZ) needs more “insurance” to bring inflation back into the 1% to 3% inflation band. He cited stronger-than-expected migration as a key factor. “Inflat...

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