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Reserve Bank of New Zealand Act 2021

Central bank functions - Foreign exchange - Foreign reserves management and co-ordination framework

143: Minister and Bank must agree on framework

You could also call this:

"The Minister and Reserve Bank must agree on rules for managing foreign money."

Illustration for Reserve Bank of New Zealand Act 2021

The Minister and the Reserve Bank of New Zealand must agree on a framework. You need to know the framework sets out requirements for managing foreign reserves. It also sets out how the Bank will use these reserves, as mentioned in section 142. The framework must say how much of the foreign reserves to keep. It can also include rules for sharing information about the reserves. You can see that the framework is about how the Bank manages its foreign reserves. The Bank must talk to the Monetary Policy Committee before agreeing to the framework. This is to make sure everyone is on the same page. The Minister and the Bank can add other details to the framework if they think it is necessary.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS321160.

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142: Purposes of framework, or

"The main goals of the Reserve Bank's plan"

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144: Form and publication of framework, or

"The plan must be written, dated, and signed, then published on the Reserve Bank's website."

Part 3Central bank functions
Foreign exchange: Foreign reserves management and co-ordination framework

143Minister and Bank must agree on framework

  1. The Minister and the Bank must agree on the framework.

  2. The framework must set out the following matters:

  3. requirements and arrangements for the Bank’s management and use of foreign reserves for either or both of the purposes referred to in section 142 (and different requirements or arrangements may be specified for different parts of those reserves):
    1. requirements for those foreign reserves (or for different parts of those foreign reserves) to be maintained at a specified level or within specified levels.

      1. The framework may include—

      2. requirements for the publication of information on the management and use of the foreign reserves and the Bank’s investment performance in relation to those reserves:
        1. any other matters that the Minister and the Bank think fit.

          1. The Bank must ensure that the MPC has been consulted on a proposed framework before it is agreed to.