Hard to know. Are they still dabbling? The whole thing was an exercise in futility but no doubt the RB will say they'll get all our money back when the currency comes down again. Of course by then we'll have no export industry to speak of and our GDP will comprise 100% gummint expenditure.Lefties' Nirvana.
Surely, however great the loss, it was worth it for the sake of keeping the dollar below US $0.76? Oh...
By my guess the paper loss is around 22 million the good Dr will have to pray to the currency gods that it dips enough so he at least breaks evengd
No - its just a non-inflationary way of reducing the budget surplus!
Err - I think you guys don't know much about currency and moneyThe Reserve bank is selling NZ dollarsThe Reserve Bank prints NZ dollars for a fraction of the face value of the moneyThe Reserve Bank can print as much money as it likes and can sell it for international currencyTherefore the Reserve Bank is making a huge profit selling the NZ dollar
But printing cash increases inflation, it does not matter what they do with it, hence doing that to fund the currency intervention means that they would have to push up interest rates to fight inflation, unless Dr Bollard wanted to lose his job.
Printing cash only causes inflation if there is a surplus to requirements.In this case there is a shortage
The RBNZ has not released the extent of the intervention to date.See: http://www.rbnz.govt.nz/statistics/rbnz/f5/data.htmlEven then, we would have to guess at the rates achieved.So not possible to work it out yet.Overall I still think they will make significant gains on the intervention.
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