RBNZ expected to cut rates by 25bps tonight – ING

The RBNZ is set to cut rates by 25bps to 2.25%, likely signaling the end of easing and providing support for NZD/USD toward 0.570 by year-end, ING's FX analyst Francesco Pesole notes.

Statement may signal end of easing, supporting NZD

"We expect a 25bp rate cut tonight in New Zealand (announcement at 0300 AM CET). That would take rates to 2.25%, which we believe is the terminal rate, as disinflation may prove slower than previously expected and growth more resilient."

"The statement should not entirely close the door to more easing, but we think the new rate projections will signal no more cuts. That would be enough of a hawkish message to trim some of the lingering expectations for more easing in 2026 (42bp priced in by May) and lift NZD."

"We remain bullish on NZD/USD and expect a return above 0.570 by year-end."