Market Pricing for RBNZ Cut --How Much is "Will do"?

By Sophia Rodrigues

Published On 13 Nov 2019 , 12:00 AM

In their markets outlook on Nov 11, economists at BNZ wrote, "RBNZ shouldn’t cut this week but probably will." Given that RBNZ wants to hear what they should do, rather than what they will do, this translates to, "RBNZ should hold this week but will probably cut." Market pricing is for around 75% chance of a 25bps cut on Thursday but I am wondering how much of that is "will do" vs "should do." Should RBNZ really cut?

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