_ _ _ _ _ _ _ _ _ _ _ https : / / www. rbnz. govt. nz / hub / publications / financial - stability - report / 2022 / nov - 2022 / fsr - nov - 22 global consumer price inflation is broad based and remains heightened. food and energy prices, and persistent core inflation, have combined to create very high headline inflation in many countries. central banks are tightening monetary conditions in an effort to slow spending and reduce inflation pressure. the ongoing slowdown in global growth will affect new zealand through both financial and trade channels, and impact on people ’ s confidence due to uncertainty. in new zealand, household spending remains resilient, especially considering the rise in debt servicing costs, the fall in house prices, and low levels of consumer confidence. employment levels are high, and income growth and household savings are supporting spending. the rebound in tourism is also supporting domestic demand. the productive capacity of the economy is being constrained by broad - based labour shortages, and wage pressures are evident. aggregate demand continues to outstrip new zealand ’ s capacity to supply goods and services, with a range of indicators continuing to signify broad - based inflation pressure. committee members agreed that monetary conditions needed to continue to tighten further, so as to be confident there is sufficient restraint on spending to bring inflation back within its 1 - 3 percent per annum target range. the committee remains resolute in achieving the monetary policy remit. meitaki ma ’ ata tena koutou, tena koutou, tena koutou katoa.

regulatory regime and policies against each other and try to reach some kind of lowest common denominator throughout the region. countless times we have heard the complaint “ why are you not allowing this, your neighbors do! ”, and i ’ m sure others people in this room have heard it too. during the crisis, we experienced several cases of countries trying to seek individual solutions to common problems. while fully respecting the idiosyncrasies and different timing priorities of each country, i think we would all benefit from a more collegial approach to regulation. on a national level, i believe the stress should be on supervision of systemically important financial institutions, with the right care not to create wrong perceptions related with moral hazard. in our region, these institutions are typically banks. in my view, these banks should become subject of a more stringent regulatory framework, in terms of capital and liquidity requirements, business and risk profile, including contingency plans. the supervisory authority should always be prepared for the worse and make sure that crisis management procedures are complete and tested. in this process, valid recommendations of international organizations will be closely followed for adequate implementation over time. it is important to have close coordination with other public authorities in the country, including government. 3. anchors of macro - prudential policies the role of anchors in monetary policy is well known. i mentioned before that an important lesson from the crisis for authorities would be to rigorously pursue countercyclical policies. i would like to stop a bit here and focus on this issue. i believe that albania was prepared for the crisis because imf programs have played an important role as a credible foreign anchor for economic policies. the imf programs and similar eu membership process have played a similar role in all cee and see countries. however as the countries have matured out of these programs or joined the eu, the political incentives to continue fiscal consolidation have been fading away. current events show that the symptoms have spread to other older members of eu, where such policies become the reason behind instability. therefore the role of anchors is very important for preserving and safeguarding financial stability. sound, clear and enforceable fiscal rule would be an important step. effective supervision based on simple and clear capital adequacy and liquidity rules would be another. the basel iii accord is a first step in the right direction. a unified approach and technical toolkit to stress - testing exercises would be also helpful. the joint stress - test exercise conducted by