RBNZReserve Bank of New Zealand
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Most recently, the RBNZ has again been among the pioneers in the central bank community when revisiting its monetary policy framework.
The external experts will take into account the objectives of the capital review, as well as the domestic context, the available literature, the international debate and policy developments globally relating to the role of bank capital in supporting the soundness and efficiency of the financial system,' RBNZ said, adding that the three experts will review the analysis and work of the Reserve Bank 'and not that of individual staff members.'
For example, mortgages with a loan-to-value ratio above 80% accounted for less than 7% of all outstanding mortgages in September 2018, down from 21% at September 2013, according to the RBNZ.
The monetary policy mandate of the RBNZ is not a narrow one.
In 2013, RBNZ issued two requests for tender (RFT) in parallel.
Instead of panicking, the RBNZ waited and watched until June 2015, when in a move which caught the markets by surprise, they reversed their policy and cut 25 bps back to 3.25 per cent, and another 25bps the following month in July.
While the RBNZ can afford itself the flexibility to accommodate changes in policy, the Fed will never have this type of flexibility to shift policy so suddenly and this would create havoc on the global markets.
Moody's Investors Service says that the Reserve Bank of New Zealand's (RBNZ) proposal to raise the amount of capital that banks will need to hold against investment loans extended for residential properties is credit positive for these institutions.
"This data is an argument for more delay before the RBNZ considers increasing the OCR (official cash rate)," Westpac Bank chief economist Dominick Stephens said in a note to clients.
'We have acted pre-emptively in reducing the OCR to lessen the economic impact of the earthquake and guard against the risk of this impact becoming especially severe,' RBNZ governor Alan Bollard said in the bank's March Monetary Policy statement.
There appears to be a consensus that the RBNZ will raise interest rates further.
Since the passing of the RBNZA-89, the RBNZ has relied heavily on `open mouth operations' to achieve its desired conditions and has rarely used other monetary policy instruments (Bonato et/ al., 1999, Guthrie and Wright, 2000).