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What is the Reserve Bank of New Zealand?

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  • Written By: Mary McMahon
  • Edited By: Kristen Osborne
  • Last Modified Date: 07 November 2016
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The Reserve Bank of New Zealand is New Zealand's central bank, responsible for setting and implementing monetary policy designed to keep New Zealand's economy stable. It is wholly owned by the government and is the sole authority with the power to print New Zealand currency. It also supervises registered banks in New Zealand, sets interest rates, and undertakes open market operations to respond to developing economic trends. Management of the bank is focused on promoting national welfare as well as the interests of New Zealand residents and companies.

Established in 1934, the Reserve Bank of New Zealand plays an important role in New Zealand's economy. It can make adjustments to the money supply by changing interest rates, producing more currency, or withdrawing currency from circulation with the goal of addressing credit crunches or tightening up credit, depending on the direction the economy is taking. The bank's goal is to keep the economy growing at a steady and sustainable rate.

While the Reserve Bank of New Zealand supervises banking operations including operations at credit unions and other financial institutions, it does not offer deposit insurance. This is provided through other parties. The Reserve Bank of New Zealand also cannot prevent bank failures, although it can identify troubled banks and work with other institutions to address struggling banks and attempt to keep them open or to transfer them to other financial institutions.

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Periodic meetings are held to discuss the state of the economy and to make any adjustments needed to monetary policy. The Reserve Bank of New Zealand is empowered to take actions it feels are appropriate for New Zealand's national economy and like other reserve banks, it has a recognized role in national security as well, as stable economies are critical for security. The organization can work with other government agencies in New Zealand to discuss proposed policy changes and their potential impact on the economy and society of the country.

Employment at the Reserve Bank of New Zealand is open to accountants, financial analysts, administrative support staff, and other personnel the bank may need. Employment conditions tend to be very good, as with many other government agencies, and staffers have access to a number of useful benefits ranging from on-site childcare to paid holidays. The working environment tends to be less formal than that at other central banks; the dress code, for example, is “tidy casual,” except for formal meetings where business attire is expected.

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