ANZ Research discusses its expectations for next week's RBNZ policy meeting.
"In New Zealand, the RBNZ faces a different set of circumstances. The need to dampen over-exuberance has led to wide-spread expectations that it will soon deliver the first OCR hike since 2014," ANZ notes.
"For the NZD, the question is how much is already in the price. The market is pricing a roughly 25% chance of 50 basis point move, we think this is unlikely. With such aggressive expectations heading into the meeting, it’s difficult to see how the RBNZ can deliver a hawkish surprise," ANZ adds.