Liam Dann, Business Editor at Large for New Zealand’s Herald, works as a writer, columnist, radio commentator and as a presenter and producer of videos and podcasts.
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They are also named in the record of the vote. In New Zealand, the process is currently anonymous on both counts.
While Breman’s address to the New Zealand media on Wednesday was brief, it specifically addressed transparency.
She emphasised the need for “transparency, accountability and clear communication” at the Reserve Bank.
Given the debacle around Adrian Orr’s resignation and subsequent lack of transparency – which led to the resignation of board chairman Neil Quigley – it was an astute point to make.
However, the Swedish central bank’s commitment to transparency extends beyond Bremen’s well-honed introductory speech.
In fact, it was the subject for a much more in-depth speech Breman gave at the Bank of England’s Centre for Central Banking Studies in London in June.
In a speech titled “Daring to Think Differently” – on the Riksbank’s monetary policy communication – she outlined how she believed the Swedish central bank leads the world on openness and transparency.
“In my experience, transparency builds trust. Openness about the basis for decisions creates an understanding of monetary policy, and of the often difficult trade-offs it faces.
Such an understanding increases confidence in monetary policy, rather than reducing it, which in turn makes the policy easier to conduct.”
She highlighted three key areas of focus for building that trust: the Riksbank’s strategy of publishing a forecast for the policy rate, of publishing alternative scenarios and its attributing in the minutes.
“[This] creates an understanding of monetary policy, and of the often difficult trade-offs it faces,” she said in the speech.
“Such an understanding increases confidence in monetary policy, rather than reducing it, which in turn makes the policy easier to conduct.”
The RBNZ does publish a forward rate track, which provides a proxy forecast for where it believes the cash rate is headed.
But it has been problematic in the past couple of years.
In 2024, the RBNZ published a track which suggested the Official Cash Rate would rise further and wouldn’t be cut until August this year.
As it turned out, the OCR was cut in August 2024. Critics called it a U-turn and a flip-flop. The RBNZ rejected this.
Then-Governor Adrian Orr argued there was a misunderstanding around interpreting the rate track.
In her response to similar criticism in Sweden, Bremen appears to have struck a more conciliatory tone in her speech: “While it would have been desirable for the forecasts to be more closely aligned with actual outcomes and less systematically inaccurate, I think these figures are still a pretty good illustration of the quote usually attributed to John Maynard Keynes: ‘When the facts change, I change my mind − what do you do, sir?’
“An important message here is that it is natural that interest rate forecasts turn out to be wrong, and that there is no drama in this. We have not found that this has affected public confidence in our ability to fulfil our mandate,” she said.
In other words: acknowledge and move on.
The transparency at the Riksbank has allowed for a review of Breman’s calls through Covid and more recently.
Westpac chief economist Kelly Eckhold has taken a look back through the records.
“When we look at her public comments and voting record while at the Riksbank we do see evidence that she was in the dovish range of the Riksbank executive board,” Eckhold says.
“In the 35 executive board meetings that she has participated in, on 33 occasions she voted with the consensus. Her two dissents were dovish: in December 2019 she voted against a 25bp hike, while in April 2023 she preferred a 25bp hike to the consensus call for a 50bp hike.”
However, it was important to recognise that this did not necessarily mean she would be dovish relative to the RBNZ Monetary Policy Committee of the past several years, he said.
“We also see some evidence that Dr Breman has activist tendencies relative to the other members of the executive board,” he said.
Westpac chief economist Kelly Eckhold.
“For example, in 2020 she was firmly with the consensus on advocating for large-scale asset purchases to combat the pandemic. However, by later in 2020, Dr Breman was among the group that began to express reservations about the duration and scale of the policy.”
In 2022, Breman also appeared to have adopted a hawkish stance at least as quickly as the wider board, he said.
But she was a relatively early mover to a more balanced approach and in 2024 and 2025 tended to be relatively dovish compared to the broader board.
Eckhold notes that the Riksbank has a strong track record of transparency and has been “a trail blazer in the area for decades”.
“For example, the Riksbank quickly followed the Bank of England in adopting the use of fan charts for the communication of forecast uncertainty in December 1997.”
Eckhold also cited its use of regular press conferences, published MPC member views on the outlook, and publicised votes.
In response to criticism of its forecasting, RBNZ chief economist Paul Conway has said the Bank will do more modelling of scenarios, as a way to be more transparent and ensure the public understands risks.
That is likely to align with the thinking of the new Governor.
Independent economist Cameron Bagrie said he would like to see the MPC publish its voting record.
He welcomed any moves to a more transparent approach from the RBNZ, but said he felt the debacle around the handling of Orr’s departure was a bigger issue than any concerns around monetary policy itself.
“At the epicentre of a central bank is its credibility, and transparency is a subset of credibility,” he said. “What I’d like to see is the record of the vote published.”
But the previous regime at the Bank had been “pretty transparent” with monetary policy, he said.
They had gotten things wrong.
“But monetary policy is an imperfect science,” he said.
“Unless there was a significant change in culture at a board level, it was going to be difficult for the new Governor to effect real change,” he said.
A new board chairperson is expected to be appointed in the coming weeks.
Breman takes up the Governor role on December 1, which means she won’t be involved in the next two Official Cash Rate decisions – widely expected to be cuts.
Liam Dann is business editor-at-large for the New Zealand Herald. He is a senior writer and columnist, and also presents and produces videos and podcasts. He joined the Herald in 2003.
