Our ANZ Chart Pack has been updated with the latest data and our analysis of recent developments.
We believe monetary easing has further to run in the Antipodes. The case for policy stimulus is clear-cut in New Zealand, where the output gap is deeply negative. We have long argued that the RBNZ will cut rates to 2.5% this cycle, and analysts and investors have recently come around to our view. Meanwhile, we expect the RBA to cut rates to 2.85%, in response to the underwhelming economic recovery. However, with the labour market still tight and price pressures showing signs of flaring up, risks are tilted towards a less expansionary stance.
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