Christian Hawkesby: COVID-19 and the Reserve Bank's balance sheet

Speech by Mr Christian Hawkesby, Assistant Governor and General Manager of Economics, Financial Markets, and Banking of the Reserve Bank of New Zealand, at the 2020 KangaNews New Zealand Capital Markets Forum, Wellington, 20 August 2020.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Introduction

E nga mana, e nga reo. E nga karanga maha o te wa.

Tēnā koutou katoa.

It is great to be able to participate in this conference that was originally scheduled for late February, albeit still remotely due to COVID-19 restrictions.

The last time I spoke to a financial markets audience in person was in late-January at a conference in Sydney. I recall being struck at the time that I had never seen a conference organiser so happy to see me arrive at a venue. Turns out it was nothing personal. All the rest of the keynote speakers were part of a world tour and had got stuck in Hong Kong in self-isolation. Travelling from Wellington, I was the only one that had made it in person.

In my mind, that was a moment when COVID-19 became something very real and tangible, spreading to our part of the globe. Of course, the world has changed remarkably since late January in response to this global health crisis. One of those ways is that the Reserve Bank's balance sheet has increased from around $25 billion to $60 billion (Figure 1), and growing.