02118cas a2200241 a 4500 AALejournalIMF015944 230101c9999 xx r poo 0 0eng d 5.00 USD 9781513514765 1934-7685 BD-DhAAL BD-DhAAL International Monetary Fund. Asia and Pacific Dept. New Zealand : Selected Issues. Washington, D.C. : International Monetary Fund, 2019. 1 online resource (47 pages) IMF Staff Country Reports <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This Selected Issues paper discusses interactions between external risks and the New Zealand economy. The current set of external risks has the potential to be extremely damaging to New Zealand, but two factors would likely mitigate the economic impact. First, the flexible exchange rate regime is a reliable shock absorber and automatic stabilizer from the perspective of GDP, although it leads to a rebalancing between the domestic and external sectors in the economy. Second, net migration flows can reduce the negative impact of lower external demand under some circumstances, such as a growth slowdown in Australia. Fiscal policy could also offset some of the short-term costs of adjustment. Fiscal policy can provide stimulus at relatively small and manageable cost to the already-low government debt to GDP ratio. Moreover, at the current juncture, fiscal policy might need to provide the bulk of policy support against negative shocks, as monetary policy might be ineffective if has become constrained by an effective lower bound on the monetary policy interest rate. Mode of access: Internet IMF Staff Country Reports; Country Report ; No. 2019/304 Full text available on IMF http://elibrary.imf.org/view/journals/002/2019/304/002.2019.issue-304-en.xml IMF e-Library