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RBNZ dated OIS pricing has firmed 4-5bps for meetings beyond April after the release of Q4 CPI.
- While Q4 CPI printed in line with consensus and below the RBNZ’s forecast, the details show that the central bank is likely to remain cautious given persistent domestically driven inflation.
- Headline rose 0.5% q/q moderating to 4.7% y/y from 5.6% in Q3. The RBNZ had projected 5% y/y. But the moderation was driven by the tradeables component, while non-tradeables rose 1.1% q/q.
- While the pace of increase in the domestically determined non-tradeables CPI eased to 1.1% q/q from 1.7% in Q3 and 1.5% in Q4 2022 (data is non-seasonally adjusted), annualised it is still at 4.3%. The annual rate moderated to 5.9% from 6.3%, which remains too high for the RBNZ to feel that the inflation fight has been won.
- The RBNZ’s measure of core inflation is also released today at 1500 local time (1300 AEDT).
Figure 1: RBNZ-Dated OIS – Post-CPI Vs. Pre-CPI
Source: MNI – Market News / Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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