The Reserve Bank is widely expected to lift the OCR by 25bp to 2.75% next Thursday, as it starts to head off the inflation pressures generated by the strengthening economy and the Canterbury rebuild. While the RBNZ doesn’t appear to be in danger of falling behind the curve, its economic projections won’t leave much room for dallying. We expect the statement to signal that follow-up hikes over the next few OCR review dates are highly likely
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