New Zealand rates: Daily outlook

Westpac Research notes:

NZ swap yields 1 day: NZ 2yr swap rates should open down 1bp at 2.88%, while the 10yr should open down 1bp at 3.73%.

NZ swap yields 1-3 month: Short maturity NZ interest rates should fall further during the next few months. The RBNZ has started a fresh easing phase, which should deliver another 75bp over the July and September meetings. We thus target a 2yr swap rate of 2.65% during the next few months (an OCR of 2.50% by September plus 15bp risk premium). The 10yr yield will be partly influenced by the RBNZ's sharp easing cycle but continue to be hostage to expectations of Fed policy tightening, a tricky call. We target 3.70%