The agency said that the Reserve Bank of New Zealand will make a key decision this week, and economists and investors are unsure whether the bank will start cutting interest rates or wait for further evidence that inflation is returning to its target.
Of the 21 economists surveyed, 12 expected the RBNZ to keep interest rates unchanged at 5.5%, but nine predicted it would start a cycle of rate cuts.
Nick Tuffley, chief economist at ASB Bank in Auckland, said the risk of over-tightening monetary policy has become a reality and the time has come for the Reserve Bank of New Zealand to cut interest rates, but much depends on how much its forecasts have changed. In less than two years, New Zealand's economy may show signs of a third recession, and inflation has slowed more than the central bank expected. But some domestic prices are still high, and if interest rates are cut now, it will be a year earlier than the signal the central bank just sent three months ago. This will be a huge turnaround for the Reserve Bank of New Zealand. (Jinshi) #crypto2023A
