RBNZ seeks candidates for Monetary Policy Committee

The search has started for two new external members of the Reserve Bank (RBNZ) committee which sets interest rates.

The RBNZ board is seeking “suitably qualified” candidates for the Monetary Policy Committee (MPC) to replace Caroline Saunders and Peter Harris, whose terms expire in March and June respectively next year.

Among the criteria candidates have to meet are expertise in monetary policy and macroeconomics, and professional knowledge and skills in public policy and banking.

“Applicants will require a strong understanding of conflicts of interest, the sensitivity associated with “inside knowledge” of monetary policy decisions, and the constraints on other activities that are necessarily associated with membership of the MPC,” RBNZ Board chair Neil Quigley said in a statement.

The MPC has four RBNZ staff members, three external members and an observer from the Treasury, with interest rate decisions usually arrived at through consensus, although the decision in May was a first with a 5-2 vote in favour of a 25 basis point rise in the official cash rate rather than holding steady.

However, public servants, bankrupts, those banned from being company directors or with recent convictions for various offences are not eligible to apply.

External members are appointed by the finance minister and serve four-year terms, may be reappointed for a second term, and can expect to spend about 60 days a year on MPC business.

In contrast to some overseas central banks, only once has an external member of the MPC made a public statement about the committee’s work and that was in response to media questions.

Former RBNZ official Michael Reddell has been highly critical of the operation of the MPC, the RBNZ staff majority, and silence of external members among other issues.

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