The Reserve Bank of New Zealand eased monetary policy more than expected yesterday by increasing its Quantitative Easing programme from NZ$60 billion to $100b and foreshadowing a ‘Funding for Lending Programme’ where the central bank lends banks money at zero percent while cutting the official cash rate below zero. The central bank had to get permission to buy 60 percent of New Zealand Government bonds on issue, up from 50 percent.

Governor Adrian Orr said overseas asset buying was the bottom of its priority list and also said an extended mortgage payment referral scheme was likely to be announced next week.