Unlikely prospect of RBNZ rate cut rears head as tightening cycle dissipates

Sun, 25 Jan 2015

By Jonathan Underhill Jan. 26 (BusinessDesk) - Traders have started pricing in a small prospect of interest rate cuts this year by the Reserve Bank of New Zealand, whose forecasts have overstated the pace of inflation for two straight quarters. The central bank is seen cutting the official cash rate by 9 basis points over the next 12 months, based on the overnight interest swap curve. Before the bank signalled a pause in its tightening cycle in July last year, some 70 basis points of hikes had been priced in. The direction of the OCR turn...

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