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New Zealand central bank expected to cut rates
Friday, 05 Sep 2008 05:12
A poll of sector commentators suggests that the Reserve Bank of New Zealand (RBNZ) is likely to reduce interest levels following its monetary policy meeting next week.
Of the 17 economists surveyed by news agency Reuters, all but one expect the central bank to cut interest rates from their current level of eight per cent to 7.75 per cent on September 11th, with one predicting a 50 basis-point cut.
Craig Ebert, senior economist at the Bank of New Zealand, adds the market has a view of around five cuts by the second quarter of 2009.
Shamubeel Eaqub, director of investment research at Goldman Sachs, commented: "There is little doubt that monetary policy needs to be neutralised, but we do not think the RBNZ is ready to cut rates aggressively just yet."
In recent days, the Reserve Bank amendment bill was passed in New Zealand, making the financial institution the regulator of non-bank deposit takers.
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