Dwindling market liquidity spurs RBNZ to increase participation to keep rates in check

Fri, 08 Apr 2016

By Paul McBeth April 8 (BusinessDesk) - Dwindling liquidity in short-term money markets has prompted the Reserve Bank to lift its participation as a means to limit volatility and keep short-term rates near the official cash rate. In the latest Reserve Bank Bulletin, analyst Andrew Kendall reports finding liquidity had declined across different markets to varying degrees, but had been manageable so far. In short-term money markets, which are a key channel for transmitting monetary policy decisions, Kendall found reduced liquidity in forei...

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