Daily Digest Market Movers: New Zealand Dollar trades stronger as traders trimmed bets on RBNZ rate cut
- 12 of 21 economists surveyed by Bloomberg expect the New Zealand central bank to keep the OCR at 5.5% on Wednesday.
- The NZIER Shadow Board is split on whether the Reserve Bank of New Zealand (RBNZ) should lower the Official Cash Rate (OCR) in its forthcoming August Monetary Policy Statement.
- Over half of the Shadow Board members expect a 25 bps reduction in the OCR required due to the persistent weakening of the New Zealand economy. The other members suggested that the Reserve Bank should keep the OCR at 5.50%.
- China’s CPI climbed 0.5% year-on-year in July, compared to a 0.2% increase in June, hotter than the expectations of a 0.3% rise, the National Bureau of Statistics of China reported on Friday. On a monthly basis, Chinese CPI inflation arrived at 0.5% MoM in July versus -0.2% prior, above the consensus of 0.3%.
- Fed Governor Michelle Bowman stated on Sunday that she still sees upside risks for inflation and continued strength in the labor market, highlighting the Fed may not be ready to cut rates at its upcoming meeting in September, per Reuters.
- Traders have priced in nearly 52.5% odds that the Fed will cut the rate by 50 basis points (bps) in the September meeting, down from 57.5% last week, according to the CME FedWatch Tool.
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