A fresh set of Reserve Bank forecasts will give the first new look at the spending landscape facing the new Government, which may well be softening.

On Thursday the central bank will release its quarterly monetary policy statement, a lengthy take on the state of the New Zealand and global financial system, as it reviews the official cash rate.

Even before the new Government announcement observers were practically certain the Reserve Bank would leave the cash rate at 1.75 per cent and the odds have not changed since Jacinda Ardern became Prime Minister.

Instead, focus is likely to fall on the Reserve Bank's forecasts for economic growth and inflation, which will influence how much room Finance Minister Grant Robertson has to play with before risking posting a deficit in his first Budget in 2018.

Thursday's statement will give little insight into the Reserve Bank's view of how the Labour-NZ First-Green Government will impact the economy.

The figures will have had just a fortnight to digest the likely new direction. With many aspects of economic policy still vague, the Reserve Bank will "stress policy uncertainty and the need to await more detail" UBS economist Robin Clements said.

But the Reserve Bank hinted in September that its growth forecasts were likely to be cut, even before calculating the impact of Ardern's plans to cut immigration.

Back in August, outgoing governor Graeme Wheeler delivered a rosy picture for growth, expected to climb to 3.8 per cent by the start of 2018, while inflation was tipped to drop below 1 per cent.

UBS predicted growth was likely to be closer to 3 per cent, while ANZ chief economist Cameron Bagrie also predicted growth forecasts would be pared down.

Meanwhile, the outlook for inflation has moved significantly since the Reserve Bank last provided forecasts in August, when it predicted inflation would drop to 0.7 per cent.

The New Zealand dollar, which plunged in the weeks following the election and especially since the new Government was announced, is now substantially weaker than expected in August. A lower dollar makes imported goods more expensive, boosting inflation.

Bagrie said given the weaker dollar, surprisingly strong inflation in the September quarter and the likelihood that Government spending would be looser than what Treasury forecast before the election, the Reserve Bank's inflation forecast "now looks unrealistic".

The New Zealand dollar may recover from its post-election plunge, which coincided with a sharp fall in business confidence.

Bank of New Zealand head of research Stephen Toplis said in a note on Friday that the market was over reacting to the uncertainty, and the sharp fall in business confidence would not be matched by a fall in economic growth.

But Toplis warned the policies of the new Government were likely to be inflationary, and issued a blunt warning about the new administrations ability to keep to Labour's spending plans.

"For the time being, we will run with Labour's stated bond tender programme" which would see the Government borrow about $7b more than National had said it would over four years.

"But we caution that Labour will struggle to keep within the spending framework that it has allowed itself and its revenue is likely to be threatened by economic growth weaker than the pre-election fiscal update presumed," Toplis said.

Government borrowing was likely to be "substantially higher than suggested".