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  • rmacculloch

Does NZ have a jobs target, or not?

In February, 2020, the Reserve Bank of NZ proclaimed: "Employment and inflation are close to target" and that


"Low interest rates remain necessary to keep employment and inflation around target".


On 7 September, 2020, the Governor stated in an interview with Liam Dann at the NZ Herald:


"We don't have unemployment as a target".


Which statements are correct? Turns out that the above two February 2020 statements are wrong. The RBNZ has never had an employment, nor an unemployment, target. It does, however, have an inflation target of between 1 and 3%.


This is no small matter. It's not for a blogger to point out that our Central Bank is confused about what is targeting.


For sources, see:


https://www.rbnz.govt.nz/-/media/ReserveBank/Files/Publications/Monetary%20policy%20statements/2020/mpsfeb20.pdf?revision=ff0f111b-a85b-4443-af6d-1d14ab1c4ec2


and


https://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=12362746