RBNZ seen holding rates, may expand QE – Reuters poll

The latest Reuters poll of 13 economists showed that all of them believe the Reserve Bank of New Zealand (RBNZ) will keep the key rates on-hold but may expand the QE programme at its monetary policy meeting next week.

Key findings

“Economists polled by Reuters predict the official cash rate (OCR) will remain unchanged at 0.25% this year, and just three see rates dropping into negative territory in 2021.

Markets expect the Reserve Bank of New Zealand (RBNZ) to stick to a dovish tone by expanding quantitative easing (QE) beyond the current NZ$60 billion ($40.13 billion) and keep alternative monetary policy tools, including negative rates, firmly on the table.

But unknowns remain, with the borders still shut, hurting New Zealand's large tourism industry, and fears of a second wave of cases looming. The government expects the unemployment rate to rise in the coming months.”