RBNZ Governor Adrian Orr told the Epidemic Response Committee today that recovery from the coronavirus pandemic would be more challenging than that of the global financial crisis of 2008-9. He noted, “the most optimistic scenario is that we come out of this very very tight lockdown, and we remain out of this lockdown in varying levels of economic activity.”
He said RBNZ’s measures are just the beginning and even negative interest rates were not off the table. Though, it wouldn’t come for 12 months and the time frame would give retail banks some certainty to prepare for the possibilities. “We’re doing the best out of a bad situation,” he said.
Separately, Prime Minister Jacinda Ardern said a decision on whether to lower lockdown from level 4 would be made on April 20. But she emphasized that significant restrictions would remain in place even if that happens. “By design, Level 3 is a progression, not a rush to normality. It carries forward many of the restrictions in place at Level 4, including the requirement to mainly be at home in your bubble and to limit contact with others,” Ardern said.
