Westpac: RBNZ expected to cut rates by 50BP after February, pace may slow

Golden October Data on February 18, Westpac economist Kelly Echold said that the Reserve Bank of New Zealand is likely to cut the official cash Intrerest Rate (OCR) by 50 basis points to 3.75% tomorrow, but expects the pace of easing to slow down after February. However, he said the RBNZ is also likely to cut the OCR further in an attempt to bring it down to neutral sooner. It is possible that the RBNZ will present a dovish scenario at its meeting, signaling its intention to adjust the OCR to neutral levels more quickly by hinting at a reduction in the OCR to 3% by mid-2025. Echold said this would indicate that the RBNZ is highly likely to cut rates by a further 50 basis points in its April assessment.