New Zealand central bank says balance sheet will keep expanding

The Reserve Bank of New Zealand’s balance sheet will continue to grow as it supports the economy and financial system in response to the COVID-19 pandemic, a senior official said on Thursday. Reserve Bank of New Zealand (RBNZ) Assistant Governor Christian Hawkesby said the implications of COVID-19 were not yet over as he outlined possible “next steps” with the country’s official cash rate already at a record low 0.25%. Among possible policy options, the RBNZ is considering taking the cash rate into negative territory for the first time ever, a funding for lending programme, foreign assets purchases, and interest rate swaps, Hawkesby said.

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