Our Australia & New Zealand Chart Pack has been updated with the latest data and our analysis of recent developments.
Although central banks in both Australia and New Zealand are unlikely to drop their hawkish bias anytime soon, we suspect that their tightening cycles are now over. The RBNZ has already succeeded in sending New Zealand into a recession, which is likely to deepen further. And a sharp downturn in activity in Australia is now well underway. While inflation has come off the boil, it won’t return to target before H2 2024 in either country. Nonetheless, as concerns about the economy take precedence, we expect both Antipodean central banks to start cutting rates by the first half of next year, sooner than most anticipate.
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