Reserve Bank’s review

Reserve Bank chairperson Neil Quigley doesn’t believe an independent inquiry into the bank’s conduct of monetary policy is necessary, but if there was to be one it would fully co-operate.

‘‘We are entirely open to that,’’ he said.

National Party finance spokesperson Nicola Willis said it would order an independent inquiry as soon as possible if it won the election, saying a self-authored review published by the bank yesterday ‘‘failed the credibility test’’.

The Reserve Bank admitted in that report that inflation could have been ‘‘lessened at the margin’’ if it had started tightening monetary policy earlier in 2021.

Chief economist Paul Conway said annual inflation, which was last measured at 7.2%, could have had ‘‘a ‘6’ in front of it’’, if different decisions had been reached.

But the bank said its review of monetary policy decisions over the past five years found they ‘‘were consistent with the data available at the time’’.

‘‘The easing in monetary policy during the Covid pandemic was warranted and worst-case economic scenarios were avoided,’’ it said.

Willis said the report highlighted mistakes that were made ‘‘but then excuses them, basically claiming they were unavoidable’’.

‘‘There’s really no hint in there of accountability for any failures. I am interested in what someone truly independent would conclude.’’

The bank kicked off a review of its remit and its implementation of monetary policy in June amid mounting criticisms that it had allowed inflation to get out of hand by sticking for too long with monetary policies that were too loose during the Covid pandemic.

But Finance Minister Grant Robertson appeared to effectively