New Zealand's central bank adds employment to mandate

New Zealand's central bank has changed its mandate to consider employment as well as inflation when setting interest rates and making other monetary policy decisions.

Previously the Reserve Bank aimed to keep inflation under control at about 2 percent. Now the bank will also aim to maximize sustainable employment. The dual mandate is similar to the mandates of the U.S. Federal Reserve and some other central banks.

The change comes into effect Tuesday as part of an agreement when incoming Reserve Bank Governor Adrian Orr begins his five-year term. The government hopes to later enshrine the change in law.

The government plans to make other changes including adding a seven-member committee to make monetary policy decisions. Those decisions are currently made solely by the central bank governor.