New Zealand Dollar: RBNZ hike seen with dovish risks – ING
ING’s Francesco Pesole expects the Reserve Bank of New Zealand to raise rates by 25bp to 2.75%, with markets fully pricing the move. He argues that current market pricing for further tightening looks too hawkish unless the RBNZ lifts its rate path significantly.
ING's analyst Francesco Pesole predicts the Reserve Bank of New Zealand will raise interest rates by 25 basis points to 2.75% in their upcoming announcement. The markets currently expect this rate hike, with some pricing it at 95 basis points by June 2027. Pesole argues that the current market expectations are too hawkish unless the RBNZ significantly increases its rate path.
The bank's potential underperformance in meeting hawkish expectations could lead to the New Zealand dollar falling below the 0.5900 level against the US dollar.
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Also reported by 2 other outlets
- Dollar gains on rate hike expectations, yen retreats past 160 channelnewsasia.com
- US Dollar: Jackson Hole keeps hike risk alive – MUFG fxstreet.com