MNI RBNZ Preview-October 2025: How Much To Ease?

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EXECUTIVE SUMMARY: 

• After Q2 GDP fell 0.9% q/q, more than the RBNZ’s -0.3% projected in August, expectations of a 50bp rate cut increased.  Now 10 out of 25 analysts surveyed by Bloomberg are forecasting 50bp of easing on 8 October. 
• The weaker GDP print means that there was more excess capacity in the economy than the RBNZ assumed in August, but the data are prone to large revisions and so it may want to stick to the 25bp rate cuts for October and November signalled in August.
• Two MPC members voted for a 50bp rate cut at the last meeting but recent and upcoming personnel changes on the committee add to the uncertainty around the October decision.  
• 36bps of easing is priced for Wednesday’s meeting, with a cumulative 63bps by November 2025.