The Reserve Bank’s job is not to keep people guessing

OPINION: To the average Kiwi, Graeme Wheeler may seem far from exciting, but the Reserve Bank governor is becoming increasingly unpredictable.

While this will make Thursday’s review of the official cash rate – the benchmark rate which determines the returns on bank deposits and the cost of getting a mortgage – more interesting, it is not meant to be that way.

Back in 2000, former Bank of England governor Mervyn King famously said “a successful central bank should be boring”.

Like a good referee, by the time reaches decision day, the decision itself should not really be the news. Speeches and comments in the lead-up should guide the market ahead of time.

READ MORE:
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Senior Reserve Bank officials accuse former colleague of having a ‘victim filter’
Not in NZ’s ‘economic interests’ to release interest rate votes – Reserve Bank
NZ Reserve Bank expected to hold rates this week, but future cuts ‘inevitable’
Banks may seek to recover lost margins by passing on little of OCR cut
Reserve Bank drops OCR to 2.25 per cent but banks may keep some for themselves

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DAVID WHITE/FAIRFAX NZ
Reserve Bank governor Graeme Wheeler took charge of the bank in 2012

READ MORE VIA STUFF

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