Reserve Bank announces further financial countermeasures

The Reserve Bank has announced a range of measures to support New Zealand's financial system.

The measures included term loans to banks, agreement with the US Federal Reserve for access to up to $US30 billion, and intervening in markets to maintain stability.

The central bank is to provide loans to banks with security for up to 12 months, to further increase the amount of money available for businesses and households.

It is also scrapping the penalties that banks would pay for keeping too much money with the RBNZ.

Overnight the US central bank, the Federal Reserve, agreed to make up to $US30bn available to ensure there would be enough supply of the world's premium currency for trade and business.

Assistant governor Christian Hawkesby said the central bank was also operating in money markets to ensure they operated smoothly and that wholesale interest rates would not rise too steeply.

He said the RBNZ was committed to the smooth running of markets and ensuring banks and businesses had enough money to operate.

This article was originally published on RNZ and re-published with permission.

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