The Reserve Bank of New Zealand cut interest rates overnight by 0.25% to 2.75% in a widely anticipated move. As this move was expected, the accompanying statement was the major focus for the markets. The central bank maintained a dovish stance and signalled in the statement that "some further easing in the OCR seems likely." It said that globally, outlook was "revised down" due to weaker activity in developing economies particularly in China and East Asia. The Domestic economy is still to fully absorb the impact of recent falls in commodity prices and is expected to grow at an annual pace of 2%. With Headline inflation expected to return to the target range by early 2016. In terms of the exchange rate, the RBNZ suggested “further depreciation is appropriate, given the sharpness of the decline in New Zealand’s export commodity prices”. The kiwi dollar was sold aggressively following the announcement and has rallied from sub 2.40 to 2.45 or so.