NZD to head lower still and RBNZ rate cuts to come – BNZ

FXStreet (Guatemala) – Analysts at BNZ expect further cuts from the RBNZ this year.

Key Quotes:

“Whether we agree or not with the RBNZ’s actions we are charged with identifying what the RBNZ will do more so than what it should do. Thus, putting all this together, we see no reason to change our current thinking on prospective Reserve Bank action. We continue to forecast further rate cuts in September and October.

The possibility of even more is rising as the likelihood of a sharper slowdown in growth than currently forecast increases. But, as the RBNZ itself states, these downside risks to growth will need to be more clearly realized before we, or they, revise our rate expectations even lower. Whatever the case on the interest rate front, we see the combination of a softening New Zealand economic trajectory, weak commodity prices and the start of the tightening cycle in the US conspiring to push the NZD lower still.”

Analysts at BNZ expect further cuts from the RBNZ this year.

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