A deeper and sooner rate cutting cycle as growth slows
Last week we changed our view that the RBNZ would cut interest rates
50bps by calendar year end to a forecast of 100bps of easing over the same
period and we placed our FX and GDP forecasts under review. Today we
cut our GDP forecast for 2015 for NZ from 3.1% to 2.3% and we now
forecast the NZ$/US$ to be 0.68, 0.64, 0.62 on a 3, 6 and 12-month view
compared to our prior forecast of 0.72, 0.70, 0.68.