29 Jul 2013
Flash: Rates in NZ over-cooked? RBNZ to remain on hold - RBS
FXstreet.com (Barcelona) - Rate hikes by the RBNZ early next year is not a done deal, according to Greg Gibbs, FX Strategist at RBS, who sees enough evidence that the housing market has cooled recently .
Key Quotes
"Cooling house prices possibly responding to its talk of macro-prudential measures, despite the last policy statement was interpreted as more hawkish and sent NZ rates higher to be pricing in rate hikes from Q1 and rates rising 60bp over 12 months."
"We are still waiting for the RBNZ to announce its planned introduction of macro-prudential measures. They decided not to announce anything last week, and are providing no hints when this may come. However, after the back up in rates and rise in NZD, we are wary that this is coming at any time."
"When it does it may remind the market that the RBNZ will probably wait to assess the impact of such measures on the housing market before raising rates. As such we continue to forecast rates on hold through the next 12 months. The recent rise in rates and NZD are viewed as opportunities to sell."
Key Quotes
"Cooling house prices possibly responding to its talk of macro-prudential measures, despite the last policy statement was interpreted as more hawkish and sent NZ rates higher to be pricing in rate hikes from Q1 and rates rising 60bp over 12 months."
"We are still waiting for the RBNZ to announce its planned introduction of macro-prudential measures. They decided not to announce anything last week, and are providing no hints when this may come. However, after the back up in rates and rise in NZD, we are wary that this is coming at any time."
"When it does it may remind the market that the RBNZ will probably wait to assess the impact of such measures on the housing market before raising rates. As such we continue to forecast rates on hold through the next 12 months. The recent rise in rates and NZD are viewed as opportunities to sell."