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VIEW: TD Securities Lift RBNZ Terminal Rate Call

RBNZ

TD Securities have lifted their terminal RBNZ OCR forecast from 4.00% to 4.50%. They highlight that offshore developments have not influenced their forecast switch.

  • TD write “activity has not taken a hit despite the rapid round of rate hikes, while financial conditions overall have probably eased. If the RBNZ is to get on top of inflation it needs wages growth to slow. A 4.00% terminal cash rate is unlikely to do the job.”
  • They also note that “the risks to our 4.50% terminal OCR are skewed to the upside. As such we don't expect RBNZ rate cuts in 2023.”
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TD Securities have lifted their terminal RBNZ OCR forecast from 4.00% to 4.50%. They highlight that offshore developments have not influenced their forecast switch.

  • TD write “activity has not taken a hit despite the rapid round of rate hikes, while financial conditions overall have probably eased. If the RBNZ is to get on top of inflation it needs wages growth to slow. A 4.00% terminal cash rate is unlikely to do the job.”
  • They also note that “the risks to our 4.50% terminal OCR are skewed to the upside. As such we don't expect RBNZ rate cuts in 2023.”