ANZ Research previews this week's September RBNZ policy meeting.

"We expect the RBNZ to deliver a 25bp hike at its meeting this week, taking the OCR rate to 2.75%. OIS markets have assigned above a 90% chance of a hike next week, so the key takeaway from the MPS will be expectations of the timing and extent of future tightening. Markets are only pricing in around a 50% probability of a hike in October. A hawkish surprise will likely firm up October pricing, which we think will only provide limited upside to the NZD, considering it would be bringing forward some the hike fully priced by OIS for the December meeting," ANZ notes.

"On the OCR track, we expect a similar track to that published in May would leave optionality open around the October meeting and have little impact on FX. In May, the RBNZ’s OCR track peaked at 3.28% in Q2 2029 and implied an average OCR of 3.1% over the two years ending Q3 2028. OIS are reflecting a rate of around 3.5% in August next year, which we think is stretched. Any indication of a softer OCR terminal rate would weigh on the NZD, potentially seeing the NZD approach key support near 0.586–0.587. Upside risks look less pronounced. Overall, we are mildly negative the NZD into the RBNZ meeting,' ANZ adds.