The Reserve Bank “derailed” the economy into a recession.

“The biggest shock of all was that the committee had discussed lifting rates,” a view with which Kiwibank strongly disagreed.

“Any talk of hikes now would be overkill. The data has clearly turned. Actually, it turned a very long time ago, at the end of 2022. And the economy is becoming weaker by the day,” they stated.

“Rate cuts should be considered,” Kiwibank argues. “We would recommend a cut in August… but we’re more concerned about the health of many businesses and households. We shall keep up the good fight.”

A separate note from BNZ economists claims that “the economy is now looking well and truly derailed.”

“Front of mind will be last week’s Quarterly Survey of Business Opinion, which provided more evidence that the current recession will roll on for a while longer, the unemployment rate will rise rapidly and, most importantly, business intentions to raise prices are declining at pace,” they noted.

“But it’s not just the QSBO that’s telling us this. The evidence from all quarters is now overwhelming.”