RBNZ Cuts Rates – Oct 08, 2025
Bigger‑than‑expected move: cut the rate by 0.50% to 2.50% in October (markets expected 0.25%).
Message: More worried about slowing growth than lingering inflation right now.
Why: Easing inflation trends, and signs of slack in housing and jobs.
What it means: Cheaper borrowing, likely softer NZD.
Next: Data‑dependent; could cut again if the slowdown deepens.
RBNZ Outlook – Sep 30, 2025
Interest Rate: 3.00% (25 bps cut from 3.25%) to support growth.
Q2 GDP: -0.9% QoQ (worse than -0.3% expected); hit by weak manufacturing and external shocks (e.g., US tariffs).
RBNZ outlook: forecasts terminal rate of 2.50% — implies further cuts ahead.
A 50bp cut expected on Oct 8th,
The surprise slump in NZ’s economy from Trump’s Liberation Day tariffs means a deeper-than-expected RBNZ rate-cutting cycle.