RBNZ frustrated as its key messages not getting through - BNZ

Jason Wong, Currency Strategist at BNZ, suggests that following the sharp move in short-term rates in response to the RBNZ’s housing market speech on Thursday night, traders had little appetite to take on fresh positions.

Key Quotes

“The RBNZ took the unusual step of pre-announcing that another speech on Wednesday would “not include discussion or guidance about forthcoming OCR decisions by the Reserve Bank”. It highlights the level of frustration by the Bank, with its key messages not getting through and might have been in response to the market reaction to Thursday’s speech. The advisory about the speech contents (or lack thereof) opens up more speculation about whether or not the Bank is happy with current market pricing. The August meeting is currently priced at a 36% chance of a 25bps cut.”