ING Bank expects the Reserve Bank of New Zealand (RBNZ) to deliver a 25-basis-point rate cut at its 8 October policy meeting, aligning with both market consensus and current pricing.
In a note to clients, ING said markets are already pricing in two additional cuts beyond October, but the bank cautioned that such expectations may be premature given the absence of third-quarter CPI data, which will be critical in shaping the policy outlook.
ING analysts noted that while domestic demand remains soft and labour market conditions have eased, the RBNZ may prefer to wait for confirmation that inflation is sustainably trending lower before committing to further easing.
Still, they added that the market’s dovish positioning means downside risks for the New Zealand dollar are now more limited in the near term, as much of the easing bias is already priced in.
The NZD, which has weakened through 2025 alongside a broader softening in commodity-linked currencies, may therefore find some stabilisation into year-end, particularly if inflation proves sticky or global risk sentiment improves.
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Earlier:
- New Zealand Q3 business confidence 18% vs 22% previous quarter
- Reserve Bank of New Zealand NZIER Shadow Board calls for 25bp interest rate cut
The Bank meet Wednesday, October 8, 2025, New Zealand time.
Statement due at 2pm New Zealand time:
- 0100 GMT
- 2100 US Eastern time (on Tuesday, October 7, 2025)
