Bevan Graham, NZ Chief Economist AMP Capital
6th July 2018
Continued weakness in business confidence is posing downside risks to the growth outlook. From an RBNZ perspective it’s not as simple as lower growth meaning lower interest rates. Lower growth can still be consistent with higher inflation in a capacity-constrained economy. Our base case remains that the next move is a hike, but it’s a long way off. And it’s certainly the case that if the RBNZ feels the need to do anything soon, it’s more likely to be a cut than a hike.