Weak economy sharpens debate on how deep the rate cut will be

Weak economy sharpens debate on how deep the rate cut will be
Governor Christian Hawkesby has two more monetary policy decisions to go. (Image: NZME)
Rebecca Howard
Markets are betting on a rate cut next week, and the only question is how deep it will be.The official cash rate (OCR) is at 3% and the debate is centred on whether the monetary policy committee votes to cut by 25 basis points on Oct 8 or by 50. In August, the monetary policy committee opted for a 25-basis-point cut by a four-to-two vote, with the two outliers pushing for a 50-basis-point cut.Since then, data has shown the economy contracted by 0.9% in the June quarter, far worse than the 0.3% forecast by the Reserve Bank of New Zealand (RBNZ),...

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