The Reserve Bank of New Zealand (RBNZ) has decided to cut the official cash rate (OCR) by 25 basis points to 5.25%, starting an easing cycle much earlier than expected, almost a year ahead of the RBNZ’s own projections, UOB Group.
The RBNZ will continue to reduce the OCR steadily
“The Reserve Bank of New Zealand (RBNZ) cut its official cash rate (OCR) by 25 basis points to 5.25% earlier today (14 August). The move came as a surprise as it kicked off an easing cycle much earlier than expected.”
“The RBNZ’s updated forecasts show an average OCR of 4.62% at the start of next year and 3.85% by the end of 2025. Growth forecasts have been revised down significantly, incorporating negative growth in both the second quarter of 2024 and the third quarter of 2024. The RBNZ now expects inflation to fall to 2.3% in the current quarter, but not return to the 2% midpoint until mid-2026.”
“Given that a faster-than-expected contraction in the economy has changed the balance of risks, we now expect the RBNZ to continue to reduce the OCR steadily by 25 basis points at each meeting for the remainder of this year to bring the OCR to 4.75% by year-end.”
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
