08 June 2006


Today is Monetary Policy Statement (MPS) day. The Governor of the Reserve Bank has announced that the official cash rate (OCR) will remain steady at 7.25%. The topic of money and monetary policy will be raised at the next 721 contact course, in case you’re not sure what that means and why it’s so important. In the meantime, you may like to look at the MPS (downloadable from the RBNZ website). It gives a good oversight of the state of the NZ economy.
But there are other sources of such useful national contextual information too. See, for example, the Treasury’s Economic and Financial Overview, or the National Bank’s New Zealand Limited which is written like a corporate annual report, with a balance sheet and performance statements (though the 2005 report is getting out of date now). And in case you think that this is too much emphasis on money and the economy, for social indicators you should look at the Ministry of Social Development’s Social Report. These kinds of documents give you credible contextual statistical information and commentary, usable as evidence. And evidence is good thing.


At 10:35 PM, Blogger alberto said...

It seems they are worried with inflation. Does it seems like the Washington Consensus? My country is always concerned about inflation and the current ocr is 15,25%.



At 10:32 AM, Anonymous Grant said...

Yes, inflation control is the primary goal, and the Reserve Bank has an independent authority to decide how to fight inflation by means of the OCR. Unfortunately, oil prices, over which NZ has no control, seem to be making this job difficult. But, the institutionalised method is based upon the standard monetarist model.


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