Submissions to Parliament’s Finance and Expenditure Committee on the Reserve Bank of New Zealand (Monetary Policy) Amendment Bill close today. Despite my scepticism about the value of the process – given that the Bank and the Minister are already actively recruiting members of their tame Monetary Policy Committee – I did lodge a submission this morning.
The full text is here Submission to FEC Reserve Bank of NZ Amendment bill Sept 2018
Most of it covers ground I’ve dealt with here over recent months, albeit in more abbreviated form. There are two main aspects to the bill:
- the proposed change in the statutory goal of monetary policy, and
- the creation of a statutory Monetary Policy Committee.
On the former
The case for having active discretionary monetary policy is – and always has been – about cyclical stabilisation. We don’t need an active Reserve Bank to deliver broadly stable price levels over…
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