According to Jinshi Data, as the Reserve Bank of New Zealand recently turned to a dovish tone, UBS is considering the possibility of lowering the official cash rate in August. Economist Nic Guesnon believes that the non-trade CPI in the second quarter needs to be lower than or at least in line with the Reserve Bank of New Zealand's forecast, and the unemployment rate must be higher than or at least in line with the forecast of 4.6%.
Guesnon said once the RBNZ starts cutting rates, they will likely not stop for some time. UBS estimates the neutral rate at 3.6% and expects the RBNZ's official cash rate to be cut for the first time in November.
