Shock drop in NZ unemployment rate has ended all talk of further official interest rate falls; now prompting increased speculation of rates

BNZ economists are now forecasting that the Reserve Bank will begin raising interest rates from as soon as May next year. The change in forecast from the BNZ follows the stunning fall in unemployment for the December quarter to 4.9% from 5.3% in September – a result that went right against market expectations (and the forecast of the RBNZ) that unemployment would rise to 5.6%. The employment figures have now removed all talk from the marketplace of the possibility of any further interest rate cuts. ANZ economists, who had been forecasting one further cut this year to the Official Cash Rate, taking it down from 0.25% … (full story)

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