The Reserve Bank of New Zealand (RBNZ) decided to reduce the official cash rate (OCR) by 50 basis points to 4.75%. In the accompanying press release, the RBNZ noted that the ‘Committee agreed that it is appropriate to reduce the OCR by 50 basis points to achieve and maintain low and stable inflation, while seeking to avoid unnecessary instability in production, employment, interest rates and the exchange rate’, says the economist of the UOB GroupLee Sue Ann.
RBNZ decides to reduce official cash rate
“The Reserve Bank of New Zealand (RBNZ) cut its official cash rate (OCR) from 5.25% to 4.75% today, marking its second consecutive reduction since it unexpectedly cut it in August. The RBNZ said then that the pace of the Future easing will depend on how confident you are about a low inflation environment.”
“We had already anticipated that the RBNZ would continue to ease. However, we expected a 25 basis point cut today, with the view that the RBNZ would not have received Q3 2024 data on growth, inflation or employment since the 25 point cut basics in August.”
“Our current view is for an additional cut of 175 basis points to a terminal rate close to 3.00% by this time next year. And we maintain our view of a 25 basis point cut at the next monetary policy meeting on November 27. However, we will revise our forecasts following the release of 3Q24 CPI data on October 16.”
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.
