MPC members announced, delivering on Govt’s plan to reform Reserve Bank Act

“The MPC members have a wide range of experience, covering monetary policy, agribusiness, international trade, private business and labour market issues,” Grant Robertson said.

A new independent decision-making body at the Reserve Bank brings a broad range of experience to important decisions like setting interest rates and how monetary policy can support maximising employment in the New Zealand economy, Finance Minister Grant Robertson says.

The members of the new Monetary Policy Committee (MPC) were announced today, delivering on the Coalition Government's plan to reform and modernise the Reserve Bank Act.

"The MPC members have a wide range of experience, covering monetary policy, agribusiness, international trade, private business and labour market issues," Grant Robertson said.

"The Coalition Government previously expanded the Reserve Bank's mandate to support maximum sustainable employment alongside maintaining price stability. The expert seven-member MPC will make the monetary policy decisions needed to achieve those goals.

"The MPC follows international evidence on the benefits of committee decision-making structures, and brings New Zealand into line with international best-practice," Grant Robertson said.

The MPC was established by the Reserve Bank of New Zealand (Monetary Policy) Amendment Act 2018. It replaces the previous structure under which the Reserve Bank Governor alone was responsible for the Bank's monetary policy decisions.

The committee is a combination of four experienced Reserve Bank economists and three outside experts:

Reserve Bank Governor Adrian Orr and Deputy Governor Geoff Bascand are the two ex officio internal members. Christian Hawkesby and Yuong Ha have been appointed as the other two internal members. The Governor will Chair the MPC.

On the recommendation of the Board of the Reserve Bank, the Minister of Finance has appointed Caroline Saunders, Bob Buckle and Peter Harris as the external members.

Reserve Bank Board Chair Neil Quigley said the revamped MPC and its operating model are designed to ensure monetary policy decisions are robust, fully informed, and appropriately transparent and challenged.

"These include the inclusion of external members into the MPC, the Bank Board's oversight of the MPC functioning, and the publishing of the MPC's minutes – all of which are global best-practice for decision making under uncertainty. The operational independence of the Reserve Bank's monetary policy decision-making is also appropriately maintained," Neil Quigley said.

Reserve Bank Governor Adrian Orr congratulated the inaugural external members of the new MPC. "The team at the Bank look forward to working constructively together in pursuit of Bank's refreshed monetary policy remit," Adrian Orr said.

(With Inputs from New Zealand Government Press Release)