New Zealand: RBNZ slashes OCR by 25 bps – UOB Group

As widely expected, the Reserve Bank of New Zealand (RBNZ) decided to lower the Official Cash Rate (OCR) for a sixth straight meeting by 25bps to 3.25%. The decision was not unanimous, with one of the six Monetary Policy Committee members voting against the cut, marking only the second time an OCR decision has gone to a vote, UOB Group's economist Lee Sue Ann reports.

RBNZ cuts rates to 3.25%, signals further easing ahead

"In a widely expected move, the Reserve Bank of New Zealand (RBNZ) cut interest rates by 25 bps to 3.25%. The decision was not unanimous, with one of the six Monetary Policy Committee members voting against the cut, marking only the second time an OCR decision has gone to a vote."

"The RBNZ signaled it might need to ease further due to higher tariffs and increased uncertainty. The central bank’s forward guidance shows the average OCR falling to 2.92% by the end of the year."

"There will be no monetary policy meeting in Jun, and the next time the RBNZ meets will be on 9 Jul, where we are expecting another 25 bps cut. At this juncture, our view is that this will likely be the last 25 bps cut, though risks are tilted towards a lower OCR trough due to increased uncertainty."