Reserve Bank Bulletin released

Release date
01 July 2013

The Reserve Bank today released the June 2013 edition of the Reserve Bank Bulletin.

The Bulletin's first article looks at how the Reserve Bank's new macro-prudential framework and associated tools could have been used if they had existed over the past financial cycle. The article says that with hindsight, there would have been a case for macro-prudential intervention from 2005 onwards.

The Bulletin's second article outlines the background of the covered bond market then goes on to look at the benefits, and challenges, arising from banks' issuance of covered bonds and the Reserve Bank's response to the development of a covered bond market in New Zealand.

The Bulletin's third article examines New Zealand exchange rate and monetary regimes over the past five decades, and whether or not different regimes have made a difference to long-term real effective exchange rates. The article suggests that fixed, managed and floating exchange rate regimes have had little effect on overall movements in the real effective exchange rate.

The exchange rate regimes article was developed from a paper delivered at a Reserve Bank/Treasury forum in March. A summary of that forum by Assistant Governor John McDermott, published in the Bulletin, concludes that reducing the average real exchange rate matters for reversing New Zealand's poor long-term economic performance but that monetary policy can't make a sustained difference to the real exchange rate. Other policy measures that might alter the savings / investment mix warrant serious consideration.

The Bulletin also carries abstracts from three Analytical Notes published recently by the Reserve Bank, a collection of recent news statements issued by the Reserve Bank, and an index of discussion papers and analytical notes published over the past two years.

Media contact:
Angus Barclay
External Communications Adviser
Ph 04 471 3698, angus.barclay@rbnz.govt.nz