Central bank- balance sheet

From the perspective of global markets, the central bank of a country issuing a minor currency has a balance sheet that is affected by its creation "out of thin air" of additiona liabilities expressed as domestic currency.

Assets
Liabilities
 * Foreign currency reserves (reserve accounts at central banks of the majors:  Japan, Switzerland, US, UK, EU).
 * "Paper Gold"- IMF SDRs (Special Drawing Rights)
 * US Treasuries and similar quality assets that are highly liquid on Forex markets. (repo with CBs of other countries)
 * RBNZ reserve accounts held by Treasury and domestic banks
 * physical currency.

Global markets context

 * NZ Currency is credit- a promise to pay High powered global money (USD or SDRs).
 * When there are higher rates of attempts of attempts to exchange created NZD for global reserve currency, then the value of the NZD goes down.
 * If the central bank is charged with the responsibility of maintaining an outside spread around Forex values, (a high bound when the CB becomes a dealer- as a seller of NZD, or a dealer as a buyer if the NZD gets too low), then these higher demands for flows will restrict the latitude the CB has in creating money.
 * If there are Currency controls to prevent leakage of NZD flows to foreign markets, then this exposure can be reduced.