Traders stop betting on rate cut as NZ economy grows at twice the expected pace

Thu, 21 Jun 2012

By Paul McBeth June 21 (BusinessDesk) - Traders have stopped betting on a rate cut by the Reserve Bank after the New Zealand economy grew more than twice the expected pace in the first three months of the year as good weather conditions stoked agricultural production. The market is betting the central bank will add 1 basis point to the 2.5 percent official cash rate over the next year, according to the Overnight Index Swap curve, removing the expectation of 44 basis points of cuts a fortnight ago. The turnaround comes after government figure...

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