FX Insights: RBNZ meeting preview (8 July)

Research evidence excerpt

FX Insights: RBNZ meeting preview (8 July)

Global Markets Research

2 July 2026FX Insights

Foreign Exchange - Global

Research Analysts

RBNZ meeting preview (8 July) Australia/New Zealand Rates

Strategy

A 25bp rate hike now appears more likely than not. Andrew Ticehurst - NAL

andrew.ticehurst@nomura.com

+61 2 8062 8611

• We now expect the RBNZ to deliver a first 25bp rate hike on 8 July (was September)

and reach ~neutral settings, with a cash rate of 3.00% by December (was February).

• We review the arguments for and against a hike and present our updated New

Zealand macro outlook, following the recent, further decline in oil prices.

• Our RBNZ and New Zealand macro views are supportive of our FX teams’ short

GBP/NZD trade recommendation, where they target a move to 2.25 (c3.8%) by end-

September, with a conviction level of 3/5.

The bottom line

The risk of higher inflation and inflation expectations has fallen with the further decline in

oil prices over recent weeks. This affords the RBNZ an opportunity to display a little more

patience, if it wishes. However, New Zealand is a large energy importer, and lower fuel

prices and increased supply mean that the growth outlook is brightening again, as

confirmed by recent business survey data. Moreover, the RBNZ has just lived through a

significant inflation scare, which might not be over.

We have reviewed our macro and market outlooks, trimming our CPI inflation and

boosting our GDP growth forecasts following the decline in oil prices. After reviewing the

arguments for and against (over), we think it will feel most comfortable shifting the cash

rate back towards more neutral settings a little faster. We have therefore brought forward

our three forecast 25bp rate hikes by ~two months, with a first hike next week (was