Low PL level?

Press, 6 October 1987, Page 48

Low PL level?

PA Wellington The Reserve Bank is forecasting low levels of primary liquidity (PL) for early October. The bank’s October liquidity projections predict PL will be about $235 million in the first week of October. As November maturing Government stock and Treasury bills enter PL in mid-October, the level of PL over the month will rise, the bank’s deputy governer, Mr Lindsay Knight, said. The average level for the month was expected to be about $470 million, Mr Knight said.

“This level of PL is consistent with firm, monetary policy in the' run up to the November provisional and terminal tax period.” The Bank expected the November tax flow to be between $9OO million and $llOO million, he said. “The Bank will conduct open market operations to smooth liquidity nows around the daily cash balance target of $2O million.” However, both the cash target and the over-all level of PL would continue to be reviewed to maintain flrm liquidity conditions, he said.