RBNZ will cut rates to 2.5% by year-end

When the RBNZ slashed rates by 25bp today, it effectively endorsed our long-held forecast for a below-consensus terminal rate of 2.5%. However, with the Bank judging the balance of risks to the outlook as tilted to the downside, we now expect the trough to arrive in Q4 this year, rather than in early-2026.

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