This week the focus shifts to the RBNZ and a likely communications challenge. A pause is universally expected, so it’ll be their tone and projections that will drive markets on the day. 

The Committee knows lowering the OCR track or anything suggesting cuts could be sooner than indicated will be met with a big easing in financial conditions, but equally, anything too hawkish could be seen by markets as a bluff. 

We think they’ll leave the track much as is and stay in data-watch mode, but with so much easing now priced in, the risks could be skewed slightly to the upside for the Kiwi on a non-dovish outcome.