Reserve Bank of New Zealand (RBNZ, Reserve Bank of New Zealand)
Reserve Bank of New Zealand (RBNZ, Reserve Bank of New Zealand) - New Zealand's central bank, which regulates the country's financial and monetary policy and is responsible for the stability of the New Zealand dollar in accordance with the national interest.
Functions and tasks of the RBNZ
Under the Reserve Bank of New Zealand Act, the New Zealand Financial Regulator was established on August 1, 1934. Since 1936 the RBNZ has been the property of the government. In 1985, the New Zealand dollar, after obtaining the status of a free currency, entered into free circulation in the international foreign exchange market. Despite this, its exchange rate is still controlled by the government in order to avoid sharp fluctuations in exchange rates.
Like most other central banks, the RBNZ is primarily a political organization. The regulator has three main areas of work:
- determination and implementation of the course of monetary policy aimed at maintaining price stability;
- To help maintain the sustainability and efficiency of the financial system;
- satisfaction of public demand for national currency.
The tasks of the Reserve Bank of New Zealand are defined by a law passed in 1989, which also gives the regulator some independence.
The functions of the New Zealand Central Bank range from financial system supervision to operational monetary policy. The regulator also performs the function of maintaining the Reserve Reserve and issuing currency, if necessary. The issuance of currency in New Zealand is the exclusive right of the RBNZ.
The bank's monetary policy complies with generally accepted international standards and pursues the main goal of maintaining financial stability. To this end, the RBNZ is prescribed the need to keep inflation in the range of 1-3% with the prospect of maintaining inflation near the target midpoint of 2%.
Realities of the Reserve Bank of New Zealand today
In addition, the MFNZ is responsible for monitoring compliance with a set of requirements for New Zealand financial institutions. Only financial institutions that meet certain criteria and are officially registered with the RBNZ are allowed to use the word "bank" in their name. In 2007, the government extended the regulator's authority to supervise and regulate financial and insurance companies, building societies and credit unions.
RBNZ is responsible for monitoring and supervising mass transactions between banks in New Zealand, as well as controlling settlement systems. Today, the volume of daily transactions is about $40 billion, which allows the RBNZ to adhere to the parameters of its monetary policy.
In the current reality of the economy, the Reserve Bank of New Zealand is tasked with monitoring companies for compliance with obligations that are directed against the financing of terrorist organizations and money laundering.
The Reserve Bank of New Zealand system includes a department of economics whose task is to advise on monetary policy and conduct economic research. There are two departments related to the maintenance of financial stability, supervision and operations, and a currency department responsible for the circulation of banknotes and coins of the New Zealand dollar.
The RBNZ currently has about 250 employees. The regulator is headquartered in a purpose-built building in Wellington. The RBNZ also has a small office in downtown Auckland.
Useful links about the work of the RBNZ
- Reserve Bank of New Zealand website: rbnz.govt.nz
- MFNZ interest rate
- Schedule of RBNZ meetings with comments
- The official currency of New Zealand: the New Zealand dollar