Analysts at Westpac point out that markets have priced a 70% chance of an OCR cut by RBNZ in August, and 1.7 cuts by May 2020.

Key Quotes

“The main reason for that is not so much to do with local fundamental developments, but rather dovish offshore pricing for the Fed and RBA which is typically influential.”

“RBNZ and RBA pricing are closely related. Indeed, the spread between the two for pricing one year ahead is currently at 38bp – not too different from the 34bp average since November 2016 (when both the RBNZ and RBA began a long onhold period).”

“If markets price even more in for the RBA (two more cuts are currently priced, which we agree with), then OCR pricing should follow suit, albeit in a dampened fashion. At some point we would favour fading the NZ move, though, particularly if Q1 GDP data shapes up to be stronger than markets (and especially the RBNZ which has forecast 0.4%) expect.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD below 1.1200 on Draghi's dovishness, amid Trump-Xi meeting announcement

EUR/USD is trading below 1.1200 after ECB President Draghi opened the door to rate cuts. Presidents Trump and Xi will hold an extended meeting at the G-20 Summit. The news cheered markets.


GBP/USD hovers above 5-month lows ahead of Conservative leadership contest

GBP/USD is hovering above 1.2500, close to the five-month lows. Conservatives will vote in the second round of their leadership contest. Boris Johnson is set to win again.


USD/JPY rallies beyond mid-108.00s on Trump's positive comments

Trump said he will have an extended meeting with the Chinese President next week. This comes on the back of Draghi's dovish comments and triggers risk-on trade. Fading safe-haven demand weighs heavily on the JPY and remained supportive.


Gold surges through $1350 level, back closer to 14-month tops

Gold built on its strong intraday positive momentum and spiked to fresh session tops, beyond the $1350 level during the early North-American session.

Gold News

Fed Preview: Proto-easing

Fed Funds 2.25%-2.50% target range predicted to be unchanged. Market expecting confirmation of easing bias into the second half. FOMC statement wording, especially "patient" and the economic projections important.

Read more