New Zealand’s financial system remains resilient to a broad range of economic risks. It remains vulnerable to severe, unlikely, risks that could cause many highly indebted New Zealand households and dairy farms to default. It is also vulnerable to international risks that could cause a major global economic recession. These vulnerabilities remain elevated but have been largely steady over the past six months. More work is needed to make the financial system more efficient and resilient to more severe risks. It is imperative to improve the resilience of New Zealand’s financial system, while conditions are conducive. A ... (full story)