Nicola Willis is the finance spokesperson for New Zealand's main opposition party.
Willis spoke in an interview with Bloomberg TV and said that if her party won power it'd quickly remove the employment mandate from the Reserve Bank of New Zealand, leaving only the inflation mandate.
In 2017, the NZ Labour Party won office. The new government overhauled the Reserve Bank, and in doing so expanded its mandate to include both stable prices and maximum sustainable employment. Its this second part that Willis wants to remove, effectively reinstating the RBNZ’s previous sole mandate on inflation targeting.
Willis:
- this “would build confidence that the Reserve Bank will be focused on that inflation mandate”
Willis cites that including employment in the mandate hasn’t had much impact on the RBNZ’s policy decisions since the change, so removing it won’t make much difference. But doing so will bring more clarity to monetary policy.
