The New Zealand dollar traded around $0.564, near its lowest level since early April, as a subdued inflation outlook added to expectations of further monetary easing. Business inflation expectations showed two-year projections, the key policy horizon, unchanged at 2.28%, while one-year expectations edged up slightly to 2.39%, within the RBNZ’s 1%–3% target range, suggesting price pressures are expected to remain contained in the near term. The survey also showed that most respondents expect the central bank to cut rates at its meeting later this month. Markets largely anticipate a 25 bps reduction to 2.25%, with a small 10% chance of a deeper 50 bps cut, amid mounting job losses and the economy nearing a second recession, keeping the New Zealand dollar under pressure and close to erasing all its gains against the US dollar this year.
