New Zealand 10-Year Yield Declines

2025-12-16 06:10 By Kyrie Dichosa 1 min. read

New Zealand’s 10-year government bond yield fell to around 4.47% after the government’s mid-year budget included a modest reduction in near-term bond issuance.

The Treasury said it will issue NZ$3 billion fewer bonds in the year ending June and NZ$2 billion fewer in the following year.

Over the four years through 2029, however, the total issuance program will reach NZ$135 billion, slightly above the May projection by NZ$3 billion.

Adding to the pressure, markets scaled back expectations for rate hikes next year after Governor Anna Breman signaled that the official cash rate is likely to remain unchanged for some time.

She added that the forward path published in the November Monetary Policy Statement still shows a slight probability of another rate cut in the near term, while noting that financial conditions have tightened more than projected.

Swaps now price rates on hold until late next year, with a hike expected in October, pushed back from September.



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New Zealand’s 10-year government bond yield fell to around 4.47% after the government’s mid-year budget included a modest reduction in near-term bond issuance. The Treasury said it will issue NZ$3 billion fewer bonds in the year ending June and NZ$2 billion fewer in the following year. Over the four years through 2029, however, the total issuance program will reach NZ$135 billion, slightly above the May projection by NZ$3 billion. Adding to the pressure, markets scaled back expectations for rate hikes next year after Governor Anna Breman signaled that the official cash rate is likely to remain unchanged for some time. She added that the forward path published in the November Monetary Policy Statement still shows a slight probability of another rate cut in the near term, while noting that financial conditions have tightened more than projected. Swaps now price rates on hold until late next year, with a hike expected in October, pushed back from September.
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