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RBNZ's Spencer expects 'smooth transition'

NZ Newswire logoNZ Newswire 11/08/2017 Paul McBeth
Graeme Wheeler, governor of the Reserve Bank of New Zealand © Getty Images Graeme Wheeler, governor of the Reserve Bank of New Zealand

Reserve Bank deputy governor Grant Spencer expects his six-month caretaker role will be a "smooth transition", pressing ahead with a sizeable body of work already underway at the monetary authority and prudential supervisor.

Mr Spencer will assume the role of acting governor when Graeme Wheeler departs on September 26, just three days after a general election where recent polling has seen the Labour Party reassert its position as the dominant opposition party under new leadership.

Finance Minister Steven Joyce judged the appointment of a caretaker as the most appropriate route to ensure the next government had time to choose a new permanent governor.

"I'm sure it will be a smooth transition with no major changes and that it'll be business as usual," Mr Spencer told BusinessDesk.

"It's not as though we'll be on autopilot, we'll be following through on the work we're doing and the initiatives underway."

The Reserve Bank has a fair amount on its plate including a review of the capital adequacy framework, finalising the bank outsourcing policy, a consultation on adding debt-to-income limits to its suite of macro-prudential tools, upgrading the central bank's settlement IT systems, and reviewing the findings of the International Monetary Fund's recent report on the financial system.

Mr Wheeler delivered his final monetary policy statement on Thursday when he held the official cash rate at 1.75 per cent and reaffirmed the track for the benchmark rate to stay unchanged until mid-2019 at the earliest.

The board advertised for a new governor in June, with applications closing in July, and will then make a recommendation to the finance minister who makes the final appointment.

Mr Wheeler was reluctant to comment on his five-year tenure as Reserve Bank governor saying instead all will be revealed in an upcoming speech.

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