This news conference will start at about 1 pm.
Our report on what this May 2023 Financial Stability Report means is here and will be updated as necessary following this news conference.
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6 Comments
"The Reserve Bank (RBNZ) says the country’s houses are still “somewhat overvalued” and prices risk falling “significantly” below a level it deems sustainable"
https://www.nzherald.co.nz/business/reserve-bank-house-prices-remain-ov…
Distressed sale avalanche?
Relevant quote from RBNZ Financial stability report. I.e. what a lot of commenters here have been saying for a while now:
In the near term prices may continue to soften, given the level of interest rates, the ongoing completion of houses currently under construction, and weak market activity and sentiment. However, there remains the risk of house prices declining significantly below our assessment of their sustainable level, particularly if the number of distressed sales picks up, generating self-reinforcing negative feedback effects.
"Therefore, profitability puts banks in a position to earn their social licence by contributing to a sound, efficient, inclusive, and dynamic financial system."
Is this social licence included in the the actual licence given to banks so they can operate? I have my doubts. Seems to me just another exhortation or jawboning, to the banks with no regulation to back it up.
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