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New Zealand's S&P/NZX 50 Falls 0.7% as RBNZ Pauses Rate Cuts

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New Zealand’s benchmark S&P/NZX 50 index dropped 0.7% to 12,769 on Wednesday, pulling back from a seven-week high hit the previous day, after the Reserve Bank paused its rate-cutting cycle. The central bank kept the cash rate at 3.25% as expected, citing concerns that current inflation and global trade tensions could fuel price pressures. It had cut rates six times since August 2023, totaling 225 basis points, but signaled further cuts may come if inflation eases as projected in May.

Corporate news weighed on the market: Citigroup downgraded a2 Milk (ATM.NZ) from "buy" to "neutral," citing growing caution over the dairy producer’s near-term outlook due to multiple data points. A2 Milk shares slid 4.1% to their lowest since early April.

Other notable decliners included Meridian Energy (MEL.NZ) (-2.3%), Infratil (IFT.NZ) (-1.5%), Port of Tauranga (POT.NZ) (-1.3%), and Fletcher Building (FBU.NZ) (-3.5%). Real estate stocks also contributed to the downward pressure, reflecting broader market caution after the RBNZ’s policy pause.