RBNZ’s Orr defends LVR restrictions, cites lengthy and difficult recovery, Kiwi stays firm

Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr appeared for Reserve Bank Annual Review in front of the Finance and Expenditure Committee during the early Wednesday’s Asian trading.

In his initial comments, New Zealand’s (NZ) central bankers praised the staff’s capacity to overcome the pandemic and its negative economic impacts. However, the following comments hint at cautious optimism while defending the latest changes in the Loan-To-Value restrictions and housing market actions as well as monetary policy actions.

Key quotes

RBNZ trying to head off excesses in housing leverage

Many covid-19 related economic risks are still with us.

Although recovery is now underway, it will be a lengthy and difficult process but we are well prepared for this challenge and we stand ready to provide stability and support.

FX implications

NZD/USD fails to respond to the mixed comments while picking up bids to 0.7240 in a four-day uptrend.

Read: NZD/USD grinds back towards resistance at the 0.7250 mark