VIEW: ANZ are "no longer forecasting that......>

RBNZ: VIEW: ANZ are "no longer forecasting that the next move in the OCR will be

up. The Reserve Bank is reluctant to hike; they made that abundantly clear in

the recent Monetary Policy Statement. And we see growth averaging 2.5% over the

next couple of years; hardly a stall, but considerably softer than the Reserve

Bank's expectation. That combination is not consistent with forecasting rate

hikes. We are now forecasting that the OCR will be flat for the foreseeable

future. Of course it is not that we literally believe the OCR will never be

moved ever again; rather, we no longer believe on balance that the next move

will necessarily be upwards. Indeed, given how long it is until a hike could

plausibly be on the cards, the balance of risks is, if anything, tilted towards

the next move being a cut. But the economy is muddling through for now. We still

expect core inflation to rise further in the near term, reflecting previous

strength in the economy. But beyond that, the resilience of underlying inflation

does not look assured."