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20 Aug 2013
What to expect from RBNZ Wheeler on 'macro-prudential policy'? - RBS
FXstreet.com (Barcelona) - RBNZ Governor Wheeler is due to speak later today at 2:00 pm New Zealand time or 2am GMT on “Explaining to role of macro-prudential policy."
Key Quotes from Greg Gibbs, Currency Strategist at RBS
"The RBNZ have prepared the framework to introduce macro-prudential tools to cool an over-heating housing market. It is fair to say there is little detail left to be divulged and the market will be looking for hints from Wheeler on the set of conditions the RBNZ is waiting for and the possible timing for the introduction of LVR restrictions."
"More recent housing data suggest that the housing market has already cooled from the hot rates of growth around mid-year. As such, there may seem somewhat less urgency to implement these measures. As such it would seem sensible that he go ahead and hint implementation is still likely in the near future."
"However, he may also acknowledge the broadening strength in the economy, and continue to warn that “removal of monetary stimulus will likely be needed in the future” as he did in the 25 July policy statement."
"The broadening in the economic recovery suggests that Wheeler may warn that while LVR restrictions may lessen the need for rate hikes and thus reduce upward pressure on the NZD, they are not intended to replace conventional interest rate policy. It is difficult to judge how the market will interpret Wheelers speech on Tuesday, but recent broader economic recovery suggests risks of further rebound in the NZD."
Key Quotes from Greg Gibbs, Currency Strategist at RBS
"The RBNZ have prepared the framework to introduce macro-prudential tools to cool an over-heating housing market. It is fair to say there is little detail left to be divulged and the market will be looking for hints from Wheeler on the set of conditions the RBNZ is waiting for and the possible timing for the introduction of LVR restrictions."
"More recent housing data suggest that the housing market has already cooled from the hot rates of growth around mid-year. As such, there may seem somewhat less urgency to implement these measures. As such it would seem sensible that he go ahead and hint implementation is still likely in the near future."
"However, he may also acknowledge the broadening strength in the economy, and continue to warn that “removal of monetary stimulus will likely be needed in the future” as he did in the 25 July policy statement."
"The broadening in the economic recovery suggests that Wheeler may warn that while LVR restrictions may lessen the need for rate hikes and thus reduce upward pressure on the NZD, they are not intended to replace conventional interest rate policy. It is difficult to judge how the market will interpret Wheelers speech on Tuesday, but recent broader economic recovery suggests risks of further rebound in the NZD."