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The NZD has reacted favourably to an uptick....>

KIWI: The NZD has reacted favourably to an uptick in the RBNZ's 2-Year inflation
estimate, which printed at 2.11% (prev. 2.02%), although the 1-Year metric was
virtually unchanged. 
- The uptick in the 2-Year print, was perhaps a little surprising given the
glass half empty outlook given by the RBNZ last week, with growing murmurs
around the possibility of further monetary policy loosening emerging from some
quarters. Nevertheless, the NZDUSD topped 0.7300, while the antipodean cross
(AUDNZD) moved towards 1.0760. In isolation the print will do little to change
the RBNZ's outlook, but the Bank will no doubt welcome the fact that the release
didn't point to a further deterioration in inflationary pressure. The short end
is currently pricing a circa 50% chance of a 25bp hike from the RBNZ by year
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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