The Government has ordered an independent review into New Zealand’s monetary policy response during the Covid 19 pandemic, aimed at identifying lessons for future major economic shocks.

Finance Minister Nicola Willis said the review was designed to provide an objective assessment of decisions made during an unprecedented period.

“An independent review means the conclusions found can be objective and constructive,” Willis said.

“The Reserve Bank of New Zealand took unprecedented action in response to the Covid 19 pandemic.”

Those actions included cutting the Official Cash Rate to 0.25 percent and deploying additional monetary policy tools such as the Large Scale Asset Purchase programme.

“These actions helped to preserve jobs and keep businesses afloat,” Willis said.

“But the indirect impacts included decades high inflation, losses of about $10.3 billion on the Large Scale Asset Purchase programme, and a significant spike in asset values, with house prices increasing 30 percent in one year.”

Willis said “The purpose of the review is to learn from experience.”

“It will focus on decisions by the Monetary Policy Committee and the analysis provided by the Reserve Bank to support those decisions.”

She said this would include Monetary Policy Committee decision making and communication, the use of additional monetary policy tools, and the coordination between monetary and fiscal policy.

Monetary policy experts Athanasios Orphanides and David Archer have been appointed to carry out the independent review.

Dr Orphanides is a former governor of the Central Bank of Cyprus and a former member of the Governing Council of the European Central Bank. He is currently a professor of the Practice of Global Economics and Management at the Massachusetts Institute of Technology.

Archer is a former assistant governor of the Reserve Bank of New Zealand and previously headed the Central Banking Studies Unit at the Bank for International Settlements.

The review is expected to be completed in August 2026 and released publicly in September 2026.