New Zealand’s New Central Bank Governor
New Zealand has appointed its first foreign central bank governor in modern history, Anna Breman, amid heightened criticism of the bank’s management of the economy. Breman, 49, is currently the deputy governor of Sweden’s Riksbank and was chosen after a worldwide search that identified 300 candidates.
Background and Experience
Breman joined the Swedish central bank’s executive board in 2019 and has contributed to decision-making on monetary policy, financial stability, and national payments systems. She became the First Deputy Governor in 2022. Prior to her role at the Riksbank, Breman worked as the group chief economist and global head of macro research at commercial lender Swedbank, and also held positions at the Swedish Ministry of Finance, the World Bank, and as a researcher at the University of Arizona. She holds a PhD in Economics from the Stockholm School of Economics and was awarded an honorary doctorate at the School of Economics and Management at Lund University last year.
Monetary Policy Views
Not much is known about Breman’s views on monetary policy, but in a recent speech, she emphasized the importance of holding inflation close to 2% and maintaining confidence in the inflation target. She also stated that the task of monetary policy is to contribute to economic stability, and that the central bank should be prepared to adjust monetary policy if the outlook for inflation and economic activity changes. At the press conference in Wellington after her appointment, Breman said that the Reserve Bank of New Zealand (RBNZ) would "stay laser focused on delivering low and stable inflation."
Challenges Ahead
Breman takes the helm at the RBNZ as it faces criticism for its handling of the economy, particularly for abetting a surge in inflation by pumping billions of dollars of stimulus during the pandemic. The bank was then forced to engineer a recession with high interest rates to get prices back under control. Additionally, the notion of central bank independence is under increasing political pressure globally, and Breman will have to navigate this challenging environment.
Cultural Approach
Breman started her speech on Wednesday with "kia ora", New Zealand’s Maori-language greeting, and expressed her keenness to learn more about the Maori economy and the country’s culture. Under the previous governor, the RBNZ had put Maori heritage and language at the centre of its operations, resulting in significant changes to its branding and approach to policy and communication. However, the current centre-right government has wound back Maori language use and ended some empowerment policies in other agencies.
Personal Life and Interests
Breman is married with two teenage daughters, and the entire family is looking forward to moving to Wellington later this year. She is also an advocate of integrating climate change into policy thinking and has previously worked on macro research and economic policy. Breman becomes the RBNZ’s first female governor and is expected to bring a new perspective to the role.
Conclusion
In conclusion, Anna Breman’s appointment as the new governor of the Reserve Bank of New Zealand marks a significant change in the bank’s leadership. With her experience and background in monetary policy, Breman is well-equipped to handle the challenges ahead, including managing the economy and navigating the complex global economic environment. As the first female governor and a foreign appointee, Breman brings a unique perspective to the role, and her commitment to delivering low and stable inflation will be closely watched in the coming months.
