Monetary policy frequently asked questions
Q. Who is responsible for setting monetary policy in New Zealand?
A. At the Reserve Bank of New Zealand responsibility and accountability for monetary policy rests on one individual - the Governor of the Reserve Bank. For further information, read Overview of the role, structure and governance arrangements of the Reserve Bank in the Briefing on the Reserve Bank of New Zealand.
Q. How does monetary policy work?
A. Have a look in the monetary policy section for relevant articles and information. If you need more historical information, the back issues of the Reserve Bank Bulletin are a good place to start looking. You should be able to find copies at your local school or university library.
Q. Where can I find that latest Monetary Policy Statement (MPS)?
A. The latest Monetary Policy Statement is available in PDF format from the Reserve Bank website shortly after 9am on the day of it’s release.
Q. Where can I find release dates for the Monetary Policy Statement (MPS) and the Official Cash Rate (OCR)?
A. We have a schedule noting release dates for the Monetary Policy Statement and Official Cash Rate announcements. Please note that the Reserve Bank reserves the right to make changes, if required due to unexpected developments.
Q. Where can I find information about the New Zealand (NZ) economy?
A. Information on the current state of the New Zealand economy and business cycle is contained in our Monetary Policy Statement (MPS). In addition, there is some information about monetary policy, the business cycle, and economic growth in New Zealand in a speech Governor Alan Bollard gave on the 28 January 2005.
Q. What are inflation and deflation?
A. When average prices throughout the economy go up, that's inflation. The flip side of inflation is deflation, when average prices are falling. Read our fact sheet What are inflation and deflation? to find out more.
Q. I'm researching inflation. Where do I find the inflation rate for the past 10 years?
A. The inflation rate (CPI) is calculated by Statistics New Zealand, but the Reserve Bank republishes some data on this website in the Statistics section. Also don't forget to read the fact sheet What are inflation and deflation?
Q. What is the Policy Targets Agreement (PTA)?
A. The Policy Targets Agreement is an agreement between the Minister of Finance and the Governor of the Reserve Bank that sets out specific targets for achieving and maintaining price stability. Read our fact sheet What is the Policy Targets Agreement? to find out more.
Q. What is the Official Cash Rate (OCR) and how does it work?
A. The Official Cash Rate is an interest rate set by the Reserve Bank to implement monetary policy, so as to maintain price stability. Read our fact sheet What is the Official Cash Rate? to find out more.
Q. How does the Reserve Bank brief an incoming government on the role and functions of monetary policy and the Policy Targets Agreement (PTA)?
A. Near elections or when the Policy Targets Agreement (PTA) is up for renegotiation, the Reserve Bank prepares a briefing on the role and functions of the Reserve Bank of New Zealand. This last happened in 2005.
Q. Where do I find Trade-Weighted Index (TWI) weightings?
A. The Trade-Weighted Index weightings are updated in December each year.
Q. What is a bank bill?
A. A bank bill is a bill of exchange issued by a bank on behalf of a company, as a promise to pay specific amounts by a due date, usually 30, 60 or 90 days ahead. To buy some you would need to talk to a broker or a financial advisor at a registered bank.
