Why is the RBNZ slashing rates but the RBA is not?

While the RBNZ started hiking rates earlier during the recent tightening cycle than the RBA, it also lifted rates to a higher peak. The RBA tempered the degree of tightening in order to preserve the large falls in unemployment seen during the pandemic and is in turn willing to tolerate a slower return of inflation to target. The upshot is that there’s less scope for policy loosening in Australia than in New Zealand.

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