RBNZ's Chief Economist, Conway, has shared views about the recent monetary policy decisions. There may be some disappointment felt by traders that were in anticipation of an indication of the Board being strongly reconsidering the 75bps hike option next month due to the lack of progress on curbing inflation. Instead, Conway has said that while interest rates have risen, there are early indications that the economy is cooling and that the fall in house prices is expected to slow consumption.

Key notes

• Era of helpful tradeable inflation may have peaked.
• The RBNZ underestimated the strength of tradable inflation.
• China is no longer the deflationary force it once was.

Comments on the inflation trajectory and the peak in the OCR will have garnered much attention.

NZD/USD update

Bulls are in control, hugging the trendline support with resistance eyed ahead.