RBNZ said it accidentally disclosed decision ahead of monetary policy announcement

  • RBNZ introduced a new funding-for-lending program (FLP) on Nov. 11 that would reduce costs for lenders, while holding its benchmark interest rate at record lows.
  • In a letter sent to non-bank financial institutions, the central bank disclosed its decision to introduce FLP about 45 minutes before it was publicly announced at 2 p.m. local time (0100 GMT), RBNZ said in a statement.
  • The letter, however, did not contain specifics of the FLP, it added.

The Reserve Bank of New Zealand (RBNZ) said on Wednesday it had accidentally disclosed information about its monetary policy announcement last week to a group of financial services firms before it was made public.

RBNZ introduced a new funding-for-lending program (FLP) on Nov. 11 that would reduce costs for lenders, while holding its benchmark interest rate at record lows.

In a letter sent to non-bank financial institutions the central bank disclosed its decision to introduce FLP about 45 minutes before it was publicly announced at 2 p.m. local time (0100 GMT), RBNZ said in a statement.

The letter, however, did not contain specifics of the FLP, it added.

"The limited information contained in the letter is unlikely to have provided anyone with a market advantage, but the Reserve Bank is taking the matter seriously," RBNZ said.

The bank's new program and its commitment to hold interest rates steady until March had sent the New Zealand dollarto the highest since March 2019 that day.

The central bank said it has engaged Deloitte to independently review internal processes and will comment further on any outcomes when the review is complete.

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