Adrian Orr, the governor of New Zealand’s Reserve Bank, resigned suddenly on Wednesday, ending a seven-year term that was marked by high interest rates and recession. Orr’s departure will be felt as he had been leading the central bank since 2016.
The National Party-led government, which took power in March 2023, had previously questioned Orr’s reappointment, but no reason for his sudden resignation has been given. Finance Minister Nicola Willis said she was aware that talks were underway between Orr and the RBNZ board on him leaving, but offered no explanation.
Deputy Governor Christian Hawkesby will act as interim governor until March 31, when Willis plans to appoint a stand-in governor for up to six months. Orr’s resignation is a surprise, given his previous statements and actions as governor, which had drawn criticism from the government.
The RBNZ raised interest rates sharply to contain inflation, causing recession. Orr had shown no inclination of leaving in February, despite announcing a half-point cut in interest rates and flagging further easings. The announcement comes just as the RBNZ is hosting an international conference to celebrate 35 years of its world-beating adoption of inflation targeting.
The sudden resignation has raised questions about the future of monetary policy in New Zealand. Experts have warned that the bank faces intense scrutiny over pandemic policies and rising living costs, and Orr’s departure will be closely watched as the central bank seeks a permanent replacement.
Source: https://www.reuters.com/world/asia-pacific/new-zealand-central-bank-announces-surprise-exit-governor-2025-03-05