BNZ economists say:
- A lower currency would remove one of the key impediments (in the market’s mind) to restarting the OCR hiking process at year-end
They note:
- The NZ TWI (79.00) is now close to the RBNZ’s Q4 average forecast
- This may start to resonate now the market is pricing only a 20% chance of an OCR hike by year-end and 35 bps by a year’s time
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NZD is basically sitting just above recent lows after having made fresh lows this session.
(The TWI is the ‘trade weighted index’ of the currency)
