What to expect? RBNZ’s monetary policy meeting today!
This article is originally referred from IronFX News.
RBNZ is expected to announce its interest rate decision on Wednesday, at 21:00 (GMT).
RBNZ is widely expected to remain on hold and keep interest rates at +1.75%.
Market is currently pricing in the probability of the bank retaining the current interest rate by more than 99% according NZD Overnight Index Swaps.
For the record, a poll conducted by Reuters resulted unanimously that the bank will remain hold at the current meeting and a large majority forecasted that the bank will remain so until the end of Q1 2019.
Hence the market’s positioning may depend on the tone and the content of the accompanying statement.
Latest release of the GDP growth rate did not bear good news for the Kiwi as it remained at +0.5% qoq, the lowest reading for the past year.
At the same time, the CPI rate is unchanged at +1.1% yoy, which is at the lower boundary of the banks inflation target of 2%±1% yoy.
On the bright side, the unemployment rate is at its lowest (4.4%) for years now, and the bank had noted it in its last accompanying statement.
Also, there could be a note for the international trading conditions given that trade tensions especially between the US and China seem to be escalating.
There is not much for the bank to be optimistic about, however given that the bank may want to keep its options open for the future, a rather neutral tone could be delivered in the document.
Original Source: IronFX News