The New Zealand central bank will buy local government debt in stimulus plans | Instant News


FILE PHOTOS: Two people walk towards the entrance of the New Zealand Reserve Bank located in the capital of New Zealand Wellington, March 22, 2016. REUTERS / Rebecca Howard / Photo File

SYDNEY (Reuters) – The New Zealand central bank on Tuesday said it would buy up to $ 3 billion ($ 1.79 billion) from local government debt to reduce liquidity pressures on the funding market as part of measures to protect the economy from coronavirus collapse.

The Reserve Bank of New Zealand (RBNZ) said the new move would be extended to its Large-Scale Asset Purchase program that has bought government debt.

“The bank has been watching for signs of increased liquidity and dislocation in the markets of the Regional Government Funding Agency (LGFA) especially in recent weeks,” he said in a statement.

($ 1 = 1.6787 New Zealand dollars)

Reporting by Wayne Cole; Editing by Shri Navaratnam

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