Wheeler says LVR policy worth 25-50 basis points of OCR rate tightening

Wed, 22 Oct 2014

By Jonathan Underhill Oct. 23 (BusinessDesk) - The Reserve Bank's introduction of limits to low-equity mortgage lending last year had a similar impact on inflation as raising the official cash rate by as much as 50 basis points, governor Graeme Wheeler told a global banking conference in Wellington. The loan-to-value ratio policy had "a dampening" impact on house price inflation and credit, " and the diminished ‘wealth effects’ on spending associated with it have reduced consumer price inflation pressures by an amount similar to a 25-50 b...

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