The OCR gravy train is slowing

After six consecutive drops, economists at the main banks say there will be a pause and possibly another cut in August. Some are even predicting further cuts in October and even February.

ANZ says whether the RBNZ cuts the OCR next week will be close-run after the recent dovish NZIER Quarterly Survey of Business Opinion (QSBO), but on balance it thinks it will remain unchanged.

It is now forecasting a cautious pace of cutting with 25 basis point drops in August and November and possibly a third cut in February to 2.50% best interpreted as a place holder for global headwinds, particularly confidence impacts.

Chief economist Sharon Zollner says the bank sees the data flow since May as dovish, easily justifying a cut next week. “We think the RBNZ should cut.