Goldman Sachs dismisses the idea that the Reserve Bank of New Zealand (RBNZ) will resort to a negative interest decision as this would harm bank profits and may cause financial instability especially given that household debt is at its highest historical levels.
Goldman Sachs say that the current option available is for bank members to turn to the monetary easing program if economic pressure resulting from the coronavirus outbreak persists. The pandemic has caused the collapse of the export sector and a decline in global demand for goods.
