RBNZ outlines priorities in Statement of Intent

Date 29 June 2016

RBNZ outlines priorities in Statement of Intent

The Reserve Bank is positioning itself to meet the challenges posed by the economic and financial environment, Governor Graeme Wheeler said today when releasing the Statement of Intent (SOI) for 2016-2019.

The Reserve Bank supports economic growth by targeting price stability, promoting a sound and efficient financial system and meeting the public's currency needs.

The SOI, signed off on 21 June, outlines the Bank's priorities for the next three years, and is framed around three themes: enhancing the Bank’s policy frameworks; continuing to strengthen the Bank’s internal and external engagement; and improving infrastructure and reducing enterprise risk.

"New Zealand’s economy is expanding, but there are headwinds and many uncertainties around the outlook,” Mr Wheeler said. “New Zealand’s financial system remains sound and well placed to support economic expansion, but rapid increases in house prices and low dairy sector incomes pose financial stability risks.

"We are working to deepen the Bank’s understanding of the current drivers of low inflation and the consequences for the economy and monetary policy.

"The Bank is implementing changes in response to the regulatory stocktake and reviewing key financial policies to best support the soundness and efficiency of the financial system. We are also working with the banks to further develop the stress-testing framework for the New Zealand banking system."

The Bank is also working to replace the Exchange Settlement Account System (ESAS) and select a replacement system for its securities and settlement and depository services (NZ Clear). Other key projects include implementing the roadmap for best-practice management of the balance sheet and finances, and developing a plan for the future custody and distribution of currency.

"The Bank has a full work plan ahead, as it continually seeks to strengthen its performance and position itself to meet the challenges ahead," Mr Wheeler said.

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