Particle.news
Download on the App Store
5 ARTICLES
·
last wk.

Reserve Bank of Australia Poised to Cut Rates as New Zealand Holds Steady

Economists pointed to easing inflation as the main reason behind markets pricing in a third 25 basis point cut on July 8

View of an entrance to the Reserve Bank of New Zealand in Wellington, New Zealand November 10, 2022. REUTERS/Lucy Craymer/ File Photo
Image
Pedestrians walk past the main entrance to the Reserve Bank of Australia building in central Sydney, Australia, October 3, 2016. REUTERS/David Gray/ File Photo
Image

Overview

  • A Reuters poll of 37 economists forecasts the Reserve Bank of Australia will reduce its cash rate by 25 basis points to 3.60% at its July 8 meeting, marking the third cut since early 2025.
  • Finder’s July survey shows 88% of experts expect the RBA to lower the cash rate, a move that could save a borrower with an A$500,000 mortgage more than A$1,600 annually if fully passed on.
  • A separate Reuters poll of 27 economists predicts the Reserve Bank of New Zealand will pause its official cash rate at 3.25% on July 9 and deliver one final 25 basis point cut by year-end.
  • Both central banks raised rates sharply to curb post-pandemic inflation and shifted to easing in early 2025, with New Zealand cutting 225 basis points since August and Australia delivering two 25 basis point rate reductions so far.
  • Policy makers remain watchful of global trade tensions, upcoming second-quarter inflation data in New Zealand and uneven growth to calibrate further easing.