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MNI RBNZ WATCH: Another 125bp Coming; Brace For Recession

(MNI) Perth

The RBNZ hiked 75bp at Wednesday's meeting, with New Zealanders set for a "shallow" recession.

The Reserve Bank of New Zealand's 75bp hike will help condemn the economy to a recession next year, with the central bank warning of another 125bps in tightening after revealing it had considered an even heftier 100bp increase at Wednesday's meeting.

Bucking the gathering trend among central banks towards a slower pace of hikes, the RBNZ ramped up its tightening campaign by lifting the Official Cash Rate for a ninth consecutive meeting to 4.25%, the highest level since early 2009, and raised its forecast for the OCR to peak at 5.5%. The 75bp hike was in line with market expectations. (See MNI RBNZ WATCH: 75bp On Table, Higher Peak Rate Seen)

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The Reserve Bank of New Zealand's 75bp hike will help condemn the economy to a recession next year, with the central bank warning of another 125bps in tightening after revealing it had considered an even heftier 100bp increase at Wednesday's meeting.

Bucking the gathering trend among central banks towards a slower pace of hikes, the RBNZ ramped up its tightening campaign by lifting the Official Cash Rate for a ninth consecutive meeting to 4.25%, the highest level since early 2009, and raised its forecast for the OCR to peak at 5.5%. The 75bp hike was in line with market expectations. (See MNI RBNZ WATCH: 75bp On Table, Higher Peak Rate Seen)

Keep reading...Show less