Reserve Bank of New Zealand expected to cut official cash rate (OCR) target by 50bp today,

The Reserve Bank of New Zealand is expected to cut its official cash rate (OCR) target by 50bp today, from 4.25% to 3.75%:

• the Reuters survey last week, February 10-13 showed 32 out of 33 expect 50 while 1 expects a 25bp rate cut

At its previous meeting, back in November of 2024, the RBNZ indicated it was still on a rate cutting path. Since then we've had Q4 inflation data with the headline well within the bank's 2 to 3% target range:

• 2.2% y/y is a little higher than was expected and is unchanged from Q3

Yesterday we had the Reserve Bank of Australia cut its cash rate by 25bp, from 4.35% to 4.1%

• ForexLive Asia-Pacific FX news wrap: RBA cuts rates for the first time in four years

A 50bp cut from the RBNZ will drag the Bank's cash rate back under the RBA's and will be a negative for NZD against the AUD, at the margin.

The Reserve Bank of New Zealand (RBNZ) statement is due at 2pm NZ time:

• 0100 GMT
• 2000 US Eastern time

Recent inflation expectations data from the RBNZ are of little concern.