Reserve Bank Governor Dr Anna Breman appeared calm and confident, as she was asked enquiring questions by Members of Parliament on her second day on the job. 

Breman appeared before the Finance and Expenditure committee, alongside the Reserve Bank’s new board chair Rodger Finlay, for a routine annual review of the organisation today. 

While the former deputy governor of the Swedish central bank wasn’t in a position to answer questions about the challenging year that was at the Reserve Bank, she provided an insight to the approach she would take going forward. 

Breman provided safe answers to questions, stressing she would be “laser focused” on the Reserve Bank’s core mandate. 

She said she would talk to fellow Monetary Policy Committee members about whether their individual views on monetary policy, including how to set the Official Cash Rate (OCR), should be made public. 

A proponent of transparency, she stressed the importance of any changes to the way monetary policy decision-making was communicated should be suitable for New Zealand, rather than replicating models used overseas. 

Finance Minister Nicola Willis is open to considering publishing Monetary Policy Committee members’ individual views. 

However, the Labour Party MPs who questioned Breman expressed hesitancy over this, noting that detailing the perspectives of all seven members of the committee could confuse the public and financial markets, and increase the likelihood of members being lobbied on how to vote. 

Speaking to the Herald last week, the Reserve Bank’s outgoing interim Governor Christian Hawkebsy noted that the way the committee worked had evolved since its inception in 2018, with external members speaking more publicly, for example. 

He was wary that detailing individual members’ views could be counter-productive, as it could encourage members to come to meetings ready to defend their views rather than be open-minded. 

Breman provided safe answers when asked about money printing – something the Reserve Bank did during the pandemic, when it wanted to soothe dysfunction in the market and provide the economy with more stimulus than could be provided by cutting the OCR, which was already near zero and couldn’t be taken in to negative territory for operational reasons. 

She took the same approach as the Reserve Bank, saying it was good to keep large-scale asset purchases (i.e. money printing) in the Reserve Bank’s toolbox, but the OCR would be its primary tool. 

Breman said the bank had to “be careful” when using this “unusual tool”. 

However, she made the point that all crises were different, and it was difficult to know what the next crisis and most suitable response would be. 

Breman and the Monetary Policy Committee will next review the OCR on February 18. 

In coming weeks, the bank will unveil changes to the amount and/or type of capital it will require banks to hold. 

Jenée Tibshraeny is the Herald’s Wellington Business Editor, based in the Parliamentary press gallery. She specialises in government and Reserve Bank policymaking, economics and banking.