The Reserve Bank’s self-assessment of its own performance fails the credibility test, says National’s Finance spokesperson Nicola Willis.

"On Thursday, the Bank released Review and Assessment of the Formulation and Implementation of Monetary Policy.

“Predictably, the Reserve Bank’s marking of its own homework pulls its punches and fails to deliver any accountability for mistakes in the management of the New Zealand economy,” Ms Willis says. 

“The report, written by the Bank’s own staff, hints at mistakes that have worsened price increases and the cost of living crisis, but fails to say whether those mistakes were avoidable and if so who should be held accountable for them?

“Those mistakes include over-doing the scale of money-printing, not lifting interest rates earlier and designing the Funding for Lending Programme so badly that commercial banks are still receiving ultra-cheap money when that no longer makes any economic sense. 

“These errors matter to every New Zealander. When the Reserve Bank gets it wrong, we all pay, with inflation and interest rates being higher for longer than they might otherwise have been.

“Kiwi families – already struggling with runaway inflation – are now being squeezed by hundreds of dollars a week in higher mortgage payments. We need to know whether that pain could have been reduced.

“This report could never answer the most vital questions because it was written by the people responsible. In fact, the Minister of Finance reappointed the Reserve Bank Governor for another five years even before publishing this report.

“National again repeats our call for an independent inquiry into the monetary policy response to COVID-19. This is about learning lessons for the future and upholding basic standards of accountability. New Zealanders deserve no less.”