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VIEW: BNZ note that "we see no reason to.......>

RBNZ
RBNZ: VIEW: BNZ note that "we see no reason to change our view that the cash
rate is on hold until the first quarter of 2022. Risks are two way. In the event
the coronavirus gets really nasty, in a GDP growth sense, it is reasonable to
assume the RBNZ would cut the cash rate in May or August. On the flip side, if
the coronavirus' impacts are short-lived and our assumed fiscal easing is
announced then a rate increase in the first quarter of next year looks
increasingly plausible and might be accompanied by a more aggressive rate track
thereafter than we have currently assumed."
- "In terms of the RBNZ's interest rate track, it is noteworthy that the low in
the OCR path has been raised from 0.9% to 1.0%. This is a very specific
indication that the Bank no longer holds an easing bias. Moreover, by June 2021
the interest rate track is 20 basis points higher than in November and the cash
rate rises to 1.9% by the March quarter 2023. At face value, the track implies a
first rate hike around the September quarter 2021."
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com
MNI London Bureau | +44 0203-865-3809 | anthony.barton@marketnews.com

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