NZD/USD gains on softer USD, despite dovish RBNZ – BBH

NZD/USD edged higher as USD weakness outweighed dovish RBNZ signals. The August ANZ business outlook survey showed business confidence improving, but activity indicators softened, reinforcing expectations of further easing. With the RBNZ projecting additional cuts into 2026, market pricing remains consistent with the OCR drifting toward 2.50%, BBH FX analysts report.

RBNZ cuts OCR to 3.00%, projects more easing ahead

"NZD/USD is firmer on USD weakness. New Zealand’s August ANZ business outlook survey supports the case for additional RBNZ rate cuts. While business confidence increased 1.9 points to a 5-month high at 49.7, expected own activity dipped 1.9 points to a 3-month low at 38.7 and reported past activity (the best GDP indicator) fell 5 points to 1."

"At its August 20 meeting, the RBNZ delivered a dovish cut. The RBNZ reduced the Official Cash Rate (OCR) 25bps to 3.00% and stressed 'there is scope to lower the OCR further.' The RBNZ projects one 25bps cut by December and another 25bps cut over H1 2026, implying the OCR will settle around 2.50%. This is roughly in line with swaps market pricing."