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NZD: 100% probability the RBNZ will cut once more this year - Westpac

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 17, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    Imre Speizer, Senior Market Strategist at Westpac, suggests that the market pricing for the RBNZ shifted lower earlier this week in the wake of the sharp fall in the RBNZ inflation expectations survey.

    Key Quotes

    “Markets now price in a terminal rate of 2.18%, i.e. a 100% probability the RBNZ will cut once more this year, and a 30% chance it will cut twice.

    We expect the RBNZ will indeed cut twice more this year. Trying to predict the exact months these will occur is tricky, but we have pencilled in June and August.

    Governor Wheeler didn’t sound in a hurry to ease during his annual speech, and the domestic economy is buoyant. However inflation is low and we expect it will remain close to zero for much of this year.”
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