As was widely expected, the RBNZ cut its Official Cash rate by 25bp, to 3.25%, today. The revelation that the decision to cut was not a unanimous one has been interpreted as a hawkish signal by financial markets. However, we would put more emphasis on the fact that the Bank is now projecting a lower path for interest rates than it did in February. Accordingly, we now think the OCR will bottom out in Q1 2026, rather than in Q2 as we had previously expected.
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