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Daily Alert: ASB expects OCR hikes from August following hawkish RBNZ assessment

  • NZ yields and the NZD jumped after the RBNZ signalled it will remove monetary stimulus.
  • ASB now expects a 25bp OCR hike in August (to 0.50%), with a follow up 25bp hike in November 2021 (0.75%), but for a gradual path of hikes thereafter, with the OCR peaking at 1.50% by mid-2023.
  • With Q2 NZ CPI looming tomorrow, there is clear upside risk to ASB’s +0.8% qoq, 2.8% yoy pick and, in fact, annual CPI inflation could push above 3%.

 

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