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Australia & New Zealand Economics

Central banks to cut rates next year

With inflation remaining stubbornly high, we now expect the RBA to lift rates to a peak of 3.85% and the RBNZ to 5.0%. Both forecasts are above the analyst consensus. With borrowing costs set to surge, we expect house prices to plunge by 25% in New Zealand and by 15% in Australia. With more scope for households to run down savings, we think that Australia will narrowly avoid a recession but we expect New Zealand’s economy to shrink in the first half of next year. With GDP growth slowing sharply, we expect a sharp slowdown in inflation. Our forecast that both central banks will ease policy by end-2023 is non-consensus.

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Minimum wage tipped to rise by 4 per cent

Submitted by admin on Tue, 24/05/2022 - 08:59

Capital Economics senior economist Marcel Thieliant said that although the Fair Work Commission is an independent tribunal, if Labor wins the upcoming federal election “it could replace key members of the FWC with people more to its liking”.

View article Financial Review