Author: Sebastian Montague

In a decisive move that sent shockwaves through the financial markets, the Reserve Bank of New Zealand (RBNZ) recently took significant action by reducing its Official Cash Rate (OCR) to 3%. This decision, made in August, not only reduced the overnight lending rate but also drastically altered the forecast for future rate pathways, signalling the possibility of further reductions. The announcement was especially surprising because two members of the decision-making committee advocated for an even more substantial cut of 50 basis points, underscoring a notably dovish stance that has since impacted the New Zealand Dollar (NZD). Understanding the RBNZ’s Decision…