Repo Market Takes Center Stage in NZ Monetary Policy

The Reserve Bank of New Zealand has highlighted the importance of the repo market in monetary policy implementation. According to Governor Adrian Orr, repo markets have grown significantly globally and domestically.

Ms. Silk discussed recent changes to the Reserve Bank's liquidity management framework, which puts weekly repo operations at its center. This change aims to support a well-functioning repo market that distributes liquidity across the financial system.

A well-functioning repo market can lower settlement cash needs and reduce the Reserve Bank's footprint in markets. Market participants are being called upon to help strengthen the depth, liquidity, transparency, and resilience of New Zealand's repo market.