RBNZ Cautious Guidance Hits NZD

The New Zealand Dollar fell sharply after the Reserve Bank of New Zealand (RBNZ) delivered its second consecutive 25bps rate hike but signaled a cautious, gradual path for future tightening.

RBNZ Governor Anna Breman highlighted uncertainty over the timing of further OCR increases, and unchanged projections imply only modest additional hikes, disappointing markets that had anticipated a faster pace.

The probability of another hike in October has fallen to around 36% down from 65% prior to the meeting.