PrintUBS Still Sees New Zealand Central Bank 25bps Rate Cut in December After This Week's 50bps Reduction
BY MT Newswires | ECONOMIC | 10/09/25 07:14 AM EDT07:14 AM EDT, 10/09/2025 (MT Newswires) -- The Reserve Bank of New Zealand delivered a 50bps rate cut to 2.50% this week, in line with UBS expectations but larger than the consensus.
More importantly, it retained its dovish bias, which sent the NZD/USD and short-dated yields lower, wrote the bank in a note.
RBNZ remains open to "further reductions," emphasizing that this week's actions should help shore up gross domestic product growth after the quarterly business survey signaled further softness in domestic trading activity, stated UBS.
Q3 consumer price index on Oct. 20 and payrolls on Nov. 5 are key data to watch before the next RBNZ meeting on Dec. 3, pointed out the bank.
Money market pricing of rates adjusted quickly, bringing the terminal rate down to 2.08%. UBS retains its view of another 25bps cut in December with a terminal rate of 2.25%.
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