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The policy origins of the Reserve Bank of New Zealand

Matthew Wright

The Reserve Bank of New Zealand formally began operations on 1 August 1934, with responsibility for currency issue, debt management and the exchange rate. Although the establishment of the Bank can be seen partly as a response to the depression of the early 1930s, it also reflected forces that played out over much of the period following the First World War. Britain’s push to see its Dominions establish their own central banks and the long-standing case for an independent New Zealand currency were both important factors shaping the debate around the case for a central bank. This article discusses these historical influences, the personalities that played a key role in the policy debate, and the events that culminated in the opening of the Bank.