redeemed for face value at the reserve bank. it also represents a legally valid form of payment which, for example, can be used to settle debts and obligations. however, traders and retailers have discretion to select what form of payment they will accept for goods and services prior to the transaction. 4 through time, the reserve bank ’ s functions expanded from issuing fiat money5 to the public in the form of bank notes and coins, to taking actions to ensure fiat money remains a stable unit of account, store of value, and medium of exchange. our monetary and financial stability mandates as well as our currency mandate are legislated in the reserve bank act ( 1989 ) and aim to promote the prosperity and well - being of new zealanders, and to contribute to a sustainable and productive economy. for example, inflation targeting aims to ensure the general rise in prices is low and stable, meaning that we can easily predict how much we will be able to buy with a dollar. likewise, the reserve bank provides accounts to commercial banks and issues electronic money to banks to facilitate the smooth settlement of payments in new zealand, ensuring the fiat money remains a useful medium of exchange. the role of cash in society today, the vast majority of new zealand ’ s money balances are digitally represented and bank notes make up just seven to nine percent of liquid money. few people use cash for their everyday transactions. however, some people, such as tourists and those who are financially, digitally or socially excluded do heavily rely on cash. 6 our 2019 public cash use survey indicated that six percent of new zealanders rely on cash for their everyday needs ( figure 1 ). despite the decline in its transactional use, cash in circulation continues to increase. this is likely due to its usefulness to some as a store of value. 4 there is no legal obligation in new zealand for shops and merchants to accept cash as a means of payment for transactions at the point of sale. see also mcbride ( 2015 ). 5 legal tender money issued by the central bank and backed by the government rather than any physical commodity. 6 people who don ’ t have access to the banking system, or with challenges that prevent them accessing it. among, for example, people with disabilities, senior citizens, people with low socio - economic status, and people living rurally with limited internet services. in addition, cash provides key public benefits including legal tender money ( that represents a claim on the government ), instant ‘ in - person ’ settlement,

of our society during the last two years. we have now made good headway in the rebuilding of the reserves which bring comfort and confidence not only to our domestic stakeholders but also to international investors who continue to have strong interest in jamaica and its many investment opportunities. already we are receiving reports of companies that have been benefiting from the adjustment in the exchange rate and others who are repositioning to capitalise on the opportunities that are being created by a more competitive jamaican dollar. these include a company successfully competing for orders in a market it was unable previously to get into and a medical practice making capital improvements in order to provide first - rate services locally more conveniently and at more competitive rates than is available overseas. i want to encourage everyone to look carefully at the opportunities that the new environment is providing. nonetheless, we remain watchful over the potential short - term negative impact of exchange rate movements on the standard of living. the monetary and fiscal policy mix will therefore seek to restrain the pass - through to inflation. however, the only way to sustainably mitigate the impact of depreciation on our standard of living is through meaningful gains in productivity and stronger economic growth. the successful implementation of the programme will also have a positive impact on businesses as the sustained reduction in public debt and the fiscal deficit will lead, and quite soon, i should add, to a “ crowding in ” of resources for the productive sector, that is, an expansion in available financing to businesses and on better terms. an environment favourable to exports should contribute to an increase in investment, economic growth and job creation, particularly within the export sector. moreover, the on - going fiscal consolidation has contributed to a compression in domestic demand, which therefore means that businesses will have to redirect their focus more towards external markets. the government ’ s commitment to improve the ease of doing business, including tax and incentive reforms and energy diversification, are designed to improve the ability of local businesses to compete successfully with foreign producers. overall, the programme strategically and deliberately creates a macroeconomic environment that is conducive to strong and sustainable export growth. in closing, i encourage the jea members to continue the process of retooling and looking at new areas for diversification of exports. i also urge you to seize to the fullest the opportunities that this programme affords. thank you. bis central bankers ’ speeches