VIEW: Kiwibank Question November OCR Liftoff

Kiwibank note that "wholesale interest rates markets have been shunted higher and pulled forward. Traders have set a 90% probability of RBNZ lift off in November. And there's four 25bp rate hikes, up to 1.25%, expected by mid-2023. We agree with the second half of that statement (pricing). The next move is most likely going to be a hike, as the RBNZ sets out to remove much of the policy stimulus put in place during the Covid outbreak of last year. Although a lift off in November feels too early to us. Because we are still in the beginnings of our vaccine roll out, and much of the inflation pressure we're experiencing should be deemed transitory. We need to see a stronger for longer lift in wages growth."