Westpac expect another Reserve Bank of New Zealand 50bp interest rate cut in February

The RBNZ cut the OCR by 50bps to 4.25% today:

• RBNZ Gov Orr says tariffs would put up pressure on price levels globally

• RBNZ Gov says it's a misunderstanding that RBNZ projections show slower pace of rate cuts
• RBNZ Monetary Policy Statement Media Conference - live link
• What is the Reserve Bank of New Zealand even doing? This is a horror 'typo'/link
• New Zealand dollar has surged higher after the Reserve Bank of New Zealand 50bp rate cut
• Reserve Bank of New Zealand cuts cash rate by 50bp, as expected

• ANZ forecast 25bp RBNZ rate cuts in February, April, and May 2025

Westpac expect another 50 cut at the next RBNZ meeting on February 19.

WPAC cite (in brief):

• OCR forecast profile revised down, shows the OCR at 3.55% at the end of 2025
• Governor Orr indicated the forward track was consistent with a 50bp cut at the February MPS but then a slower pace later in 2025
• Orr indicated neutral OCR likely lies in the 2.5% - 3.5% range
• RBNZ’s forecasts for economic growth have been revised down
• peak unemployment rate has been revised down to 5.2%
• Inflation is forecast to remain at or above 2%
• non-tradables inflation has been revised up in the near term
• remains some uncertainty on how quickly domestic inflation pressures will normalise, balanced by uncertainty on how quickly the economy will respond to interest rate cuts.