IDEAS home Printed from https://ideas.repec.org/a/nzb/nzbbul/june20115.html
   My bibliography  Save this article

New Zealand's emergency liquidity measures during the global financial crisis

Author

Listed:

Abstract

This article discusses the steps taken by the Reserve Bank to alleviate market stress and maintain market functioning during the international financial crisis of 2007–09. Our statistical analysis suggests that the emergency liquidity policies introduced during the crisis period narrowed bank funding spreads in the domestic money market by 5-7 basis points, on average, per announcement. We also find some evidence that these policies helped to reduce the volatility of money market spreads. Collectively, these policies had a material cumulative impact, probably going well beyond the simple announcement effects on money market conditions captured by our formal analysis. This is because some of the policies were taken deliberately in a pre-emptive manner, and more generally they helped to limit broader disruption to the economy’s access to credit during the recession.

Suggested Citation

  • Aidan Yao & Enzo Cassino, 2011. "New Zealand's emergency liquidity measures during the global financial crisis," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 74, pages 39-50, June.
  • Handle: RePEc:nzb:nzbbul:june2011:5
    as

    Download full text from publisher

    File URL: http://www.rbnz.govt.nz/-/media/ReserveBank/Files/Publications/Bulletins/2011/2011jun74-2cassinoyao.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Joseph E. Gagnon & Matthew Raskin & Julie Remache & Brian P. Sack, 2011. "Large-scale asset purchases by the Federal Reserve: did they work?," Economic Policy Review, Federal Reserve Bank of New York, issue May, pages 41-59.
    2. Joyce, Michael & Lasaosa, Ana & Stevens , Ibrahim & Tong, Matthew, 2010. "The financial market impact of quantitative easing," Bank of England working papers 393, Bank of England.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chris Hunt, 2016. "A short history of prudential regulation and supervision at the Reserve Bank," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 79, pages 1-22, August.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nzb:nzbbul:june2011:5. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Reserve Bank of New Zealand Knowledge Centre). General contact details of provider: http://edirc.repec.org/data/rbngvnz.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.