New Zealand: RBNZ announces huge QE – ANZ

This morning the RBNZ announced that it would conduct large-scale asset purchases of New Zealand Government bonds (‘QE’), following similar moves by global central banks last week, analysts at ANZ Research apprise.

Key quotes

“The RBNZ will purchase $30bn worth of NZGBs across the yield curve in the next 12 months. Given the size of the package, we think it will put to bed any questions about how effective it will be.” 

“QE will help support the economy and soothe markets that have been dysfunctional. We believe this package will have an immediate and significant impact on the local bond market.”

“More QE, liquidity measures and market intervention may yet be needed. We also see a case for easing the counter-cyclical capital buffer to help facilitate the provision of credit.”