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An external member of the Reserve Bank's monetary policy committee (MPC) has taken the unusual step of replying to media questions about his role on the committee and reaction to last week's super-sized rise in the official cash rate (OCR).
Former Council of Trade Unions economist Peter Harris has released a record of his answers to questions from a media outlet, which he said was a personal and not an official statement, although he gave little away in his responses.
Harris prefaced his responses with a statement that members of the MPC were "not free agents" to make personal statements on policy, especially when economically sensitive information was involved, and were generally bound "for better or worse" by conditions of their warrants, which steered them towards reaching consensus.
Asked if he considered himself an advisory or full member of the MPS, he said he was a full and independent member and brushed aside a question about whether external members were expected to be seen but not heard, describing it as rhetorical.
Harris did not engage with a question about whether the new inflation peak forecast of 7.5 percent in the latest monetary policy statement was significant in him supporting the consensus decision to raise the OCR by 75 basis points to 4.25 percent.
"This question is way beyond the consensus/confidentiality/collegiality boundaries of the Charter."
Asked if he would reassess his decision to support the latest decision if inflation did not rise to the RBNZ's higher forecast, Harris replied decisions were based on the best information available.
"Obviously that has a reflective element. We learn from what we did. We can never reverse decisions via hindsight."
Harris said the current economic environment offered unprecedented turbulent and uncertain times, and he had no idea what would happen next globally.
"I take comfort that in general we review our monetary settings seven times a year, so we are highly adaptive. In a crisis we can respond almost immediately."
He said apart from possible adjustments about the size of past rate rises, he would have stuck with the decisions that had been made.
"We dodged a bullet. Every analyst was predicting economic apocalypse and we saw off the horsemen."
Harris broadly described the run-up to the making of an interest rate decision, and described a question about whether decisions would have been different had he not been a member as "hypothetical".
He said the questioner should judge whether he was worth the $50,000 a year he was paid as a committee member ... "I have no idea."
An RBNZ spokesperson said Harris has been approached privately by the media, but had chosen to release responses through the central bank.
Harris gave an interview to the Bloomberg financial wire in April last year explaining why a vote in the MPC had never been needed to be taken.
