{"id":31468,"date":"2026-03-24T16:58:45","date_gmt":"2026-03-24T16:58:45","guid":{"rendered":"https:\/\/www.vtmarketsglobal.com\/en\/uncategorized\/31468\/"},"modified":"2026-03-24T16:58:45","modified_gmt":"2026-03-24T16:58:45","slug":"rbnz-governor-anna-breman-warns-middle-east-conflict-may-raise-inflation-soon-slowing-new-zealand-growth-momentum","status":"publish","type":"post","link":"https:\/\/www.vtmarketsglobal.com\/en\/live-updates\/31468\/","title":{"rendered":"RBNZ Governor Anna Breman warns Middle East conflict may raise inflation soon, slowing New Zealand growth momentum"},"content":{"rendered":"BNY\u2019s Head of Markets Macro Strategy, Bob Savage, relayed comments from RBNZ Governor Anna Breman on the Middle East conflict and its effects on New Zealand. Breman expects the conflict to raise near-term headline inflation and weaken New Zealand\u2019s growth momentum.\n\nShe referred to risks to global financial stability that could affect New Zealand banks. She said domestic banks are resilient due to strong capital and liquidity buffers, and indicated the RBNZ is not in a hurry to raise interest rates.\n\n<h3>Rbnz Policy Response Framework<\/h3>\nBreman said the Monetary Policy Committee will assess the right response to avoid acting too early or too late. The committee aims to stop temporary inflation rises from becoming embedded.\n\nThe RBNZ\u2019s stated aim is low and stable inflation over the medium term to support New Zealanders\u2019 wellbeing. The article notes it was produced with the help of an AI tool and reviewed by an editor, with content selected by the FXStreet Insights Team.\n\nThe Reserve Bank of New Zealand is signalling it will hold rates steady, even as inflation pressures from the Middle East conflict build. With new data showing annual CPI at 4.1% while last quarter&#8217;s GDP growth was a mere 0.2%, the RBNZ is clearly more worried about a recession than inflation right now. This suggests we should position for the Official Cash Rate to remain on hold through the next few policy meetings.\n\nThis dovish stance in the face of rising inflation makes us cautious on the New Zealand dollar. The central bank is essentially choosing to support a weak economy, which is likely to make the NZD underperform against currencies whose central banks are more focused on fighting inflation. We see value in using options to express a bearish view on the NZD\/USD pair for the coming quarter.\n\n<h3>Nzd Volatility And Curve Implications<\/h3>\nLooking back at the sharp policy pivots we saw in 2025, the RBNZ\u2019s current inaction creates significant uncertainty for the medium term. This environment is ideal for long volatility strategies, as the market could be underpricing the risk of a sudden policy change later this year. Implied volatility on NZD options has already climbed to a three-month high of 11.2%, and we expect this trend to continue.\n\nIn the rates market, this policy dilemma points towards a steeper yield curve. The RBNZ&#8217;s statements should keep short-term bond yields anchored, as no hikes are imminent. However, persistent inflation fears will likely cause investors to demand higher yields on longer-term government bonds, widening the spread between two-year and ten-year notes.\n\n<b><a href=\"https:\/\/www.vtmarkets.com\/trade-now\/\">Create your live VT Markets account<\/a>\u00a0and\u00a0<a href=\"https:\/\/myaccount.vtmarkets.com\/login\">start trading<\/a>\u00a0now. <\/b>\n<p>\r\n\r\n<p><strong>Start trading now &#8211; Click <a href=\"https:\/\/www.vtmarketsglobal.com\/en\/trade-now\/\">here<\/a> to create your real VT Markets account <\/strong> <\/p>\r\n<!-- \/wp:post-content -->","protected":false},"excerpt":{"rendered":"<p>RBNZ Governor Breman warns Middle East conflict may lift inflation, slow growth; banks resilient; rates unlikely soon.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-31468","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/31468","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=31468"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/31468\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=31468"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=31468"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=31468"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}