ING Research discusses its expectations for this week's RBNZ policy meeting.

"The Royal Bank of New Zealand (RBNZ) announces monetary policy at 0100 GMT tomorrow and we are aligned with the consensus call for a 50bp rate hike. This is its first monetary policy meeting since November, and policymakers will need to take note of the deterioration in activity indicators, inflation having undershot the Bank’s projections, and a housing market that has remained under pressure," ING notes. 

"There is one key risk to our call though: the impact of the cyclone in New Zealand. This has triggered growing speculation that the RBNZ will only hike by 25bp or even pause, and is probably behind the drop in NZD/USD to 0.6200 this morning. Admittedly, this downside risk has become more material now, but we stick to our call for a hawkish 50bp hike by the RBNZ, and we think this will lift the New Zealand dollar tomorrow. However, we think this may be one of the last times the RBNZ has a direct positive impact on NZD as many factors suggest a dovish pivot will come soon," ING adds.