New Zealanders go to the polls in 2014 and with theelection now a little over 6 months away politicalannouncements are starting to make headlines. Last weekwe got the details of the opposition Labour Party’s proposedrevamp of the monetary policy framework should theylead the next government. Changes include widening theRBNZ’s mandate and introducing a new tool to help themachieve an additional goal of achieving “positive externalbalances”. Of course the Reserve Bank has already startingexperimenting with new tools by introducing restrictionson low equity lending. Six months down the track, we thinkthe RBNZ will soon start loosening these restrictions.
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