INDEPENDENT NEWS

RBNZ Deputy Governor Bascand raises possibility of rate cut

Published: Fri 22 Feb 2019 04:28 PM
The Reserve Bank of New Zealand Deputy Governor Geoff Bascand has spoken with reporters on the RBNZ’s proposals to increase bank capital requirements.
His key points were:
•Proposals could raise borrowing costs and ultimately lead to tighter monetary conditions
•This may require a cut to the OCR (official cash rate)
•“If we were worried…and thinking we may have an economy that’s undershooting inflation or undershooting maximum sustainable employment, we’d offset it with an OCR change”
The RBNZ is proposing that banks be require to raise high-quality Tier-1 capital to 16% of overall risk-weighed assets – almost double the current regulatory requirement.
Banks have said the consequences of the proposals could lead to slower credit growth, higher borrowing costs and weaker economic growth.
The OCR currently stands at 1.75%
NZD is lower across the board in response.
Current indicative levels are:
NZD-USD 0.6765 / 0.6790
NZD-AUD 0.9540 / 0.9565
NZD-EUR 0.5965 / 0.5990
NZD-GBP 0.5185 / 0.5210
NZD-JPY 74.90 / 75.15

Next in Business, Science, and Tech

PGF backing growth in Gore
By: New Zealand Government
Cigarette price rise offsets cheaper petrol
By: Statistics New Zealand
MBIE reinstates Fuji Xerox as a government supplier
By: BusinessDesk
Service sector growth at lowest level since 2012
By: BusinessDesk
Auditor-General ramps up scrutiny of the PGF
By: BusinessDesk
Management, monitoring, and evaluation of the PGF
By: Office of the Auditor-General
PGF invests in Top of the South ocean economy
By: New Zealand Government
Supporting our regions with $2.3 million investment
By: New Zealand Government
Cawthron welcomes funding for National Algae Centre
By: Cawthron Institute
Council welcomes funding for Smart Services
By: Marlborough District Council
Innovative Intergenerational Regional Strategy Announced
By: Marlborough District Council
NZ 1st-qtr inflation comes in below expectations
By: BusinessDesk
MBIE lifts suspension on Fuji Xerox
By: Fuji Xerox
Economy slowing while Government in denial
By: New Zealand National Party
View as: DESKTOP | MOBILEWe're in BETA! Send Feedback © Scoop Media