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Ahead of this week’s Reserve Bank of New Zealand (RBNZ) monetary policy meeting this Wednesday, the New Zealand Institute of Economic Research (NZIER) Monetary Policy Shadow Board offer their expectations on future monetary policy path.

Key quotes

“Fewer Board members this quarter consider further monetary policy stimulus is appropriate, particularly when it comes to introducing a negative OCR. 

While there was support for an expansion of the Reserve Bank’s Large-Scale Asset Purchases (LSAP) programme over the coming year, this stimulus was considered more appropriate beyond the upcoming meeting.

Some members considered introducing a negative OCR an ineffective way to stimulate demand, and all members felt expanding QE was more appropriate.”