This Is Last Hike in the Cycle for RBNZ: UBS WM's Tan

The video discusses the market's reaction to the RBNZ's unexpected dovish hike, suggesting that the RBNZ is likely done with rate hikes for now. It compares the Kiwi dollar's performance with the Aussie dollar, predicting the latter's outperformance due to better economic conditions. The focus is shifting from interest rate differentials to growth drivers in the FX market. The US dollar is expected to weaken as the Fed signals an easing bias, with the dollar index likely to follow this trend.

What was the market's initial expectation before the RBNZ meeting?

• A significant rate cut

• One or two rate hikes

• A dovish cut

• No change in rates

Why might the Australian dollar outperform the Kiwi dollar?

• Better terms of trade and current account surplus

• Higher inflation rates

• Stronger political stability

• Lower interest rates

What is the expected timeline for the RBNZ to consider rate cuts?

• Early 2025

• Early 2023

• Mid 2023

• Late 2024

What is the current focus in the currency market as global central banks end their hiking cycles?

• Interest rate differentials

• Growth drivers

• Political stability

• Trade agreements

What is the anticipated trend for the US dollar over the next 6 to 12 months?

• Significant strengthening

• Stability with minor fluctuations

• Substantial weakening

• Complete collapse