FXstreet.com (Barcelona) - Kiwi inflation data has just been published and by judging the reaction of the Kiwi post release, it looks like the figures continue, if not strengthen, the case for the RBNZ easing in the future, intact. The price change QoQ came at 0.3% vs 0.6% expected, while the year-over-year figures was 0.8% versus the 1.0% projection.
In view of Mr. Jones, Currency Analyst at Bank of New Zealand, the soft data "only reinforce the market’s inclination to price in RBNZ rate cuts (a full 25bps cut is now fully priced into the curve)." Yesterday, BNZ economist Stephen Toplis argued a case was being built, in which he sees the Reserve Bank of New Zealand starting to find it harder and harder to maintain its cash rate unchanged in the foreseeable future. According to the economist, recent downbeat data on PMI, PSI and now low CPIs, all suggest market will start pricing in higher odds of RBNZ easing, with expectations of strong NZ Q3 GDP being downgraded.
In view of Mr. Jones, Currency Analyst at Bank of New Zealand, the soft data "only reinforce the market’s inclination to price in RBNZ rate cuts (a full 25bps cut is now fully priced into the curve)." Yesterday, BNZ economist Stephen Toplis argued a case was being built, in which he sees the Reserve Bank of New Zealand starting to find it harder and harder to maintain its cash rate unchanged in the foreseeable future. According to the economist, recent downbeat data on PMI, PSI and now low CPIs, all suggest market will start pricing in higher odds of RBNZ easing, with expectations of strong NZ Q3 GDP being downgraded.
