But some fear the scheme will simply fuel the boom in the housing market at a time when prices are already surging in the middle of a recession and global pandemic. Despite that, Ardern has acknowledged concern about the house price boom - little surprise given the political ramifications for her Government. Lynn Grieveson/Newsroom Prime Minister Jacinda Ardern's party made its way from opposition into government on the back of concerns about housing affordability. To some extent, the anticipated effect of the Reserve Bank’s moves is merely salt on the wound, given the underlying structural problems with the housing market. But it nonetheless seems unwise for banks to be given carte blanche to channel the financial injections into the housing market rather than more productive assets, as Bayly has pointed out.

Source: Stuff November 18, 2020 18:54 UTC