Big decision for the RBNZ
The covid cases in Auckland have thrown a major wrench into the RBNZ’s plans to hike rates today. A day ago a 25 bps hike was a sure thing and there was a 20% chance of a 50 bps hike in the OIS market. Now, the 0200 GMT decision is up in the air, priced at about 56% of a 25 bps hike.
Expect a big move on the kiwi in the aftermath but we also continue to await covid data and the potential for more cases.
Before the decision we will get 2245 GMT data from New Zealand on the Q2 PPI. At 2350 GMT, Japan will release machinery orders for June and the July trade balance. Finally, we get Australia’s Q2 wage price index at 0130