AP Exclusive: Russia, Vietnam Using Energy Profits To Avoid Possible US Sanctions For Arms Deals

Samantha Luan

Commodity

Forex

Political

Russia-Ukraine Conflict

Economic

Summary:

Russia and Vietnam have developed a back-door method of concealing arms deal payments to avoid American and other Western sanctions, using the profits from joint oil and gas ventures to pay off defense contracts without any open transfers of cash through the global banking system, according to internal Vietnamese documents obtained by The Associated Press.Under the system, Vietnam has purchased Russian military equipment including fighter jets, tanks and ships on credit from Moscow, then pay that credit back from its share of profits from a joint Vietnam-Russia oil company operating in Siberia. Such transactions are irregular in international financial markets and in this case are designed to keep cash quietly flowing even if sanctions aimed at ending Russia's war on Ukraine are strengthened, the documents make clear.

The revelation comes at a precarious time when the U.S. is trying to strengthen ties with Vietnam as a bulwark against growing Chinese assertiveness in Southeast Asia, and has ongoing trade negotiations after the White House imposed 20% tariffs on Hanoi, while at the same time President Donald Trump is threatening even more stringent sanctions on Moscow.The European Union has also added a raft of new sanctions to pressure Russian President Vladimir Putin to end the war, and Trump recently issued an executive order doubling tariffs on India to 50% to pressure New Delhi to stop buying Russian oil and military equipment, which he said was helping enable the war against Ukraine.

The Trump Organization, the president's family business, also broke ground earlier this year on a $1.5 billion luxury golf complex outside the capital, Hanoi, after Vietnam fast-tracked approval. The president's sons run the organization, but financial disclosures in June indicated that Trump himself benefits from many of its activities.News that the unorthodox arrangement was in the works leaked in 2023. But rather than shutting it down, an internal document from last year reveals that Russia and Vietnam finalized and implemented it, while also making agreements to ensure it would produce sufficient funds for future military purchases.

The Vietnamese government document that was leaked in 2023 and the newer government document from last year were provided to The Associated Press by an official who said that he was part of a faction opposed to closer ties to Russia at the risk of jeopardizing the growing relationship with Washington. He provided the documents on condition of anonymity to protect himself from possible reprisals from Vietnam's authoritarian government.

The U.S. State Department refused to comment specifically on the documents or the payment plan designed to skirt American sanctions, referring comments to the Vietnamese government. It reiterated broadly, however, that “our sanctions remain in place.”

“Those engaging in certain transactions or activities with sanctioned entities and individuals may expose themselves to sanctions risk or be subject to an enforcement action,” the State Department said in an email to the AP this week.Vietnam’s Ministry of Industry, the Vietnam Oil and Gas Group, known as Petrovietnam or PVN, and the Foreign Ministry did not respond to multiple emails seeking comment on the payment scheme. Russia’s Finance Ministry, which conducted the negotiations for Moscow, also did not respond.“It’s not your typical flexible financing. It’s not your typical offset or counter-trade provisions,” said Evan Laksmana, who leads the Southeast Asian Security and Defense research program for the International Institute for Strategic Studies think tank.

“It is,” Laksmana said, “next-level stuff.”

How the arrangement works

The mechanism involves using Vietnam’s profits from a joint Vietnam-Russia oil venture in Siberia, Rusvietpetro, to repay loans for military purchases while avoiding transactions through the global SWIFT network system, which powers most international financial transfers and is overseen by the United States and other western nations. In effect, it's a series of transactions that skip carefully laid global financial pathways, keeping transactions secret.Final details of the agreement were laid out last summer in the 2024 memo obtained by the AP, from PVN to Vietnam’s Ministry of Industry and Trade ahead of a visit to Hanoi by Russian President Vladimir Putin.

The plan outlined involves:

—First, Vietnamese profits from the Rusvietpetro joint venture in Siberia are sent to Moscow to pay back credit extended for military purchases;

—then, Vietnam's profits exceeding the loan repayments are transferred to Russian state-owned oil and gas company Zarubezhneft in Russia;

—finally, in Vietnam, Zarubezhneft uses its joint venture company there to transfer an equal amount of money to PVN, effectively avoiding any international financial transfers.

“In the context of the U.S. and Western countries imposing sanctions on Russia in general and removing Russia from SWIFT in particular, this payment method is considered relatively confidential and appropriate because money only circulates within the territory of Vietnam and Russia and Vietnam does not have to worry about the risks of being affected by the U.S. embargo,” PVN’s general director, Le Ngoc Son, writes in the June 11, 2024, document.

Laksmana said he did not have previous knowledge of the plan, but that it fit with Moscow’s approach toward arms deals in the region. In 2017, for example, Russia agreed to provide 11 Sukhoi Su-35 fighter jets to Indonesia in exchange for palm oil, coffee and other goods.“Russia was for a long time in Southeast Asia considered to be among the most flexible in terms of its payment mechanisms,” he said.Two Western diplomats posted to Hanoi said they had long suspected Vietnam and Russia had a backdoor agreement to pay for large military contracts, though the specifics of the agreement in the documents obtained by the AP were new to them. They both spoke on condition of anonymity due to the political sensitivities of the issue.

Why is the mechanism necessary?

Zarubezhneft does not currently face sanctions imposed following Russia’s attacks on Ukraine, though its CEO, Sergei Kudryashov, was named in a raft of sweeping sanctions on the Russian energy sector announced in January, ten days before Trump was inaugurated.

Zarubezhneft board chairman Evgeniy Murov, a former KGB officer, was also sanctioned by the U.S. in 2014 when he headed the Federal Protective Service, responsible for the safety of Russian President Vladimir Putin and other high-ranking officials.As individuals on the Office of Foreign Assets Control's SDN list, any assets they have in the U.S. would be blocked and Americans would be prohibited from having direct dealings with them.The mechanism outlined in the documents obtained by the AP seems intended to avoid the possibility of future sanctions, and the threat of secondary sanctions that could be imposed on those who facilitate the activities of entities under primary sanctions.

“If you want to insulate yourself from any kind of risk, you then basically avoid cross-border transactions and create these kind of offsetting payment schemes,” said. Ben Hilgenstock, a senior economist at the Kyiv School of Economics who is an expert on Russian sanctions and analyzed the Vietnamese documents for the AP.Following a wave of fresh Russian attacks on Ukraine this month, Trump has said he is ready to move to a second phase of sanctions on Moscow or countries that buy its oil. Last week, EU and American officials met in Washington to discuss details. Last Friday, Britain announced a new set of sanctions targeting Russia’s oil revenues and military supplies, including banning 70 ships from a “shadow fleet” it said is being used to transport Russian oil to circumvent international sanctions.

The main threat of secondary sanctions comes from the Countering America’s Adversaries Through Sanctions Act, or CAATSA, measures adopted during Trump’s first term, which make it possible to impose sanctions on countries or people with commercial dealings with Russia’s military-industrial complex.The threat is particularly powerful due to its vagueness, Hilgenstock said, which prompts companies and countries to exercise an overabundance of caution."Everyone else is left figuring out where exactly the red line is and how to toe it, and how not to cross it," he said. “And the result is compliance, or more often overcompliance.”

Vietnam's strategic strength is on the rise

Vietnam has one of the most capable militaries in Southeast Asia and has been strengthening its naval and air power, largely geared toward a possible threat from China. China today is Vietnam’s largest trade partner, but confrontations between the two countries over South China Sea territorial claims are growing.

The United States, meantime, is Vietnam’s largest export market. And since Washington lifted its arms embargo on Vietnam in 2016, it has become increasingly important in supplying defense goods. The U.S. government also sees Vietnam as an important strategic partner as it seeks to counter China.A decades-long defense relationship with Russia means that Vietnam will be dependent upon Russia for spare parts and other material for years to come, however, and recent contracts suggest Hanoi is not backing away from Moscow even as ties with the U.S. grow closer.

In 2011, Russia extended Vietnam $2 billion in credit for a deal that included two frigates for its navy and 64 T90S tanks. Another $8 billion in credit was given for a 2023 defense deal involving SU-30 fighter jets and two more frigates; none of which Russia has delivered yet.The official who provided the two internal Vietnamese-language documents detailing the repayment arrangement provided access to other internal government information that was verified by the AP through other sources, demonstrating his role in multiple high-level activities within Vietnam's political and governmental hierarchy.The earlier document outlining the early stages of planning, from March 2023, was reported on by The New York Times later that same year.

In the earlier document, Vietnam's Finance Ministry warns that arms deals with Russia could lead to American sanctions “because the U.S. has continuously pressured Vietnam to switch to buying U.S. weapons, threatening to sanction Vietnam under CAATSA if Vietnam continues to buy Russian weapons.”But at the same time, it suggests the United States may be persuaded to hold off on imposing sanctions on Vietnam because, among other things, “the U.S. values Vietnam’s role in implementing the Indo-Pacific strategy” meant to counter China’s growing assertiveness.

When the 2023 document leaked, Vietnam’s ruling Communist Party dismissed it as a Russian fake meant to damage Hanoi’s relations with Washington, as the countries prepared to elevate their relations to a “Comprehensive Strategic Partnership,” Vietnam’s highest level of diplomatic ties, an official privy to the internal communications told the AP on condition of anonymity to avoid possible reprisals.But there was no sign of any rift when then President Joe Biden arrived in September 2023 to finalize the partnership.

Analysis of the documents backs up their authenticity

Both documents appear genuine, from the embedded metadata, format, unique classification codes and other details, said Ben Swanton, co-director of The 88 Project, an NGO focused on human rights abuses in Vietnam that frequently deals with government documents.Vietnam also has a track record of deliberately misleading Washington, and when it has been called out on it, so far there has been no action taken, he said.

For example, last year the 88 Project provided the U.S. State Department with internal Vietnamese documents detailing how Hanoi was misinforming Washington about its efforts to address human trafficking concerns, but the State Department upgraded Vietnam in its annual trafficking report anyhow, Swanton said.“Vietnam has learned that Washington will give it a free pass basically,” he said.The State Department defended the decision to upgrade Vietnam, saying that “the government demonstrated overall increasing efforts” to eliminate trafficking, though conceded it still “did not fully meet the minimum standards.”

Plans spelled out in the documents obtained by AP have also now come to fruition. During Putin's June 2024 visit to Hanoi, Zarubezhneft received a license to develop the “Block 11-2” gas field on Vietnam’s continental shelf, the same area mentioned in the 2024 PVN memo. An internal PVN document from this April, obtained by the AP from a different source, said Zarubezhneft had begun 3D mapping of the block.And during a May visit to Moscow, a delegation led by To Lam, Vietnam's top official, signed a number of oil and gas exploration-related deals and a “Strategic Partnership Plan” for defense and other cooperation covering 2026 to 2030, according to a joint statement from both sides.

It now remains to be seen how the mechanism will be used as sanctions pressure grows from the EU and the U.S., said Huong Le-Thu, deputy director of the International Crisis Group think tank’s Asia Program.“Vietnam needs to navigate in this less conducive diplomatic environment where being too close to Russia will not be well received in European capitals,” Le-Thu said, noting that Hanoi is also now faced with an American administration far more transactional in approach.“It’s fair to assume they are not going to be as generous as the previous administrations," she said, "even with a recognition of Vietnam’s strategic value."

Source: Yahoo Finance

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Kevin Morgan

Cryptocurrency

• The Fed cuts rates amid economic shifts, affecting markets.

• Immediate impact on borrowing costs and asset demand.

• Potential increase in liquidity and market volatility.

The Federal Reserve has executed its first interest rate cut of 2025, lowering the federal funds target range by 25 basis points to 4-4.25%, as announced in Washington, D.C.

This move is crucial as it seeks to tackle a softening labor market while addressing persistent inflation, potentially prompting shifts in market dynamics and investor behavior towards risk assets.

Analysis of the Recent Rate Cut

Federal Reserve has undertaken its first interest rate cut of 2025, bringing the federal funds target range down by 25 basis points to 4-4.25%. This decision comes as the labor market shows signs of weakening while inflation remains elevated.

The decision, made by the Federal Open Market Committee (FOMC), was led by Chair Jerome H. Powell. A dissenting vote from Stephen I. Miran pushed for a larger, 50 basis point cut, highlighting divisions within the committee.

"In support of its goals and in light of the shift in the balance of risks, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 4 to 4‑1/4 percent. … The Committee is strongly committed to supporting maximum employment and returning inflation to its 2 percent objective." - FOMC Official Statement

Economic Impact on Markets

The cut is expected to lower borrowing costs, potentially easing access to credit and encouraging increased demand for risk assets. Major crypto assets like BTC and ETH may witness increased upward volatility as a result.

The Fed's liquidity operations now include a $500 billion repo cap and adjusted reverse repo operations. These changes aim to maintain the federal funds rate within the new target range, potentially increasing system liquidity.

Effect on Financial Markets and Crypto

The financial market may experience shifts, with risk assets possibly seeing increased flows. Traders could adapt strategies to align with the new economic environment. The effects on crypto assets and traditional markets will be closely monitored.

Historically, rate cuts have led to increased TVL in DeFi protocols, with yields becoming more attractive. Market observers anticipate similar behavior in BTC, ETH, and other Layer 1 tokens, reflecting past cycles of Fed easing.

For more detailed updates, follow this link for the Federal Reserve Press Release on Monetary Policy - September 2025.

Source: CryptoSlate

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Samantha Luan

Forex

Political

Economic

The US Federal Reserve's 25 basis-point rate cut, with signals of more to follow, has put the spotlight on whether foreign capital will once again chase Indian equities.Lower US rates typically weaken the dollar, boosting the appeal of emerging markets like India for global investors, but this time, several Dalal Street participants are not confident of a flood of money into stocks here like in the past. This is because the appeal for India has been blunted by rich valuations and opportunities in cheaper markets like China.

"The equity allocation is expected to shift from the US to emerging markets post the cut but given the expensive valuations in India, China is likely to see higher foreign interest," said Siddarth Bhamre, head of research, Asit C Mehta Intermediates.On a provisional basis, overseas investors sold shares worth ₹2.28 lakh crore so far this year. In September, foreign selling ebbed with these investors offloading shares worth ₹10,596.7 crore provisionally, after selling to the tune of over ₹80,000 crore in July and August combined.The slowing pace of foreign selling this month has raised expectations of a gradual revival in inflows."The pace of sell-off is slowing, but global investors continue to believe India is expensive," said Nilesh Shah, MD at Kotak Mahindra Asset Management.According to data from Julius Baer India, MSCI India is currently around 22 times price to earnings, while the MSCI EM is trading at 14.3 times.

Shah said in the near term, rich valuations could keep some foreign investors on the sidelines, while some may await clarity on the tariffs before deploying funds. He said active funds have been active in the IPO market though."Since the dollar is likely to soften further, the outflows from the US are expected to be allocated to emerging markets, but it's difficult to predict when the turnaround will happen," he said.The US dollar Index, which ended marginally higher post the Fed outcome on Wednesday night, has dropped 0.7% so far this week to 96.9.

The Fed cut interest rates by 25 basis points for the first time since December and signalled two more rate cuts in 2025.The silver lining is that India's valuation premium over other EMs has declined over the past few months and is near long-term average levels in the wake of the recent market weakness.Investment advisors expect the foreign outflows to run their course soon."FPI pessimism is currently at record high levels, and the return of earnings momentum along with the resumption of trade talks with the US should improve the FPI sentiment for Indian equities," said Unmesh Kulkarni, managing director, Senior Advisor, Julius Baer India.Shah said flows by domestic institutions like mutual funds, pension funds and insurers could be the turnaround factor."If DIIs can induce fear of missing out among foreign counterparts, their selling can turn into buying," he said.Domestic investors have pumped in around ₹5.46 lakh crore in 2025.

Source: Kitco

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Daniel Carter

Economic

The core inflation figure — which strips out prices of fresh food — was in line with the 2.7% expected by economists polled by Reuters.

Headline inflation in the country also dropped to 2.7%, from 3.1% in July, marking a fresh low since November 2024.

The so-called "core-core" inflation rate, which strips out prices of both fresh food and energy and is closely monitored by the Bank of Japan, was at 3.3%, down from 3.4% in July.

Rice inflation, which has contributed to a cost-of-living crisis in the country, softened significantly to 69.7%, down from July's 90.7%, but remains at historic highs.

The inflation figure comes as the Bank of Japan is set to announce its rate decision later Friday. The Reuters poll of economists expects the BOJ to keep its benchmark policy rate at 0.5%.

In a Sept. 12 note, HSBC analysts also agreed with the consensus, but forecasted that the BOJ would raise rates by 25 basis points at its October meeting.

The analysts said that BOJ officials are looking for signs of economic resilience, "and we believe that the second quarter GDP print, which outperformed market expectations, certainly delivered."

Japan's second-quarter GDP came in above expectations, posting a 0.3% quarter-on-quarter growth in the second quarter of 2025, mostly due to export resilience.

This was compared to the revised 0.1% growth seen in the first quarter, and was higher than the 0.1% increase expected by economists polled by Reuters.

Furthermore, with its U.S. trade deal finalized, Japan's exporters got some relief from the risk of higher tariffs, although HSBC warned that a slowdown in global trade could still impact them.

In late July, Tokyo reached a deal with Washington to lower tariffs on Japanese exports to 15%, down from 25% that U.S. President Donald Trump had threatened in his "tariff letter."

On a separate note, they added that Japan's elevated inflationary pressure — driven by high rice prices — is also prompting louder calls for further rate hikes.

Senior Liberal Democratic Party member Taro Kono had reportedly said on Sept. 9 that "If the Bank of Japan delays a rate increase, I think it would mean inflation will continue and everything we import would be higher."

Source: CNBC

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Daniel Carter

Central Bank

Economic

Key points:

● BOJ concludes 2-day meeting, decision expected 0300-0400 GMT.

● Short-term policy rate seen steady at 0.5%.

● Governor Ueda expected to hold news conference 0630GMT.

● Focus on Ueda's views on tariff impact, US economy.

The Bank of Japan is expected to keep interest rates steady on Friday, as policymakers seek more clarity on whether the economy can withstand U.S. President Donald Trump's tariffs and growing signs of weakness in the American economy.

The BOJ's meeting comes in the wake of the U.S. Federal Reserve's decision on Wednesday to cut interest rates and signal more reductions to halt any slide in an already weakening labour market.

A downturn in U.S. growth would cloud the BOJ's rate-hike path by adding strains to Japan's fragile recovery, which is starting to see exports hit by Trump's tariffs.

Markets are focusing on Governor Kazuo Ueda's post-meeting briefing for hints on how soon the BOJ could resume rate hikes, paused since January as policymakers gauge the tariff impact.

"We expect the BOJ to raise rates by early next year, but it is unclear whether officials will be able to make a decision this coming October," said Kei Fujimoto, senior economist at SuMi TRUST.

"Policymakers will carefully assess the impact of tariffs on future corporate earnings and accordingly, whether companies are in a position to continue raising wages."

At the two-day gathering concluding on Friday, the BOJ is widely expected to keep interest rates steady at 0.5%.

While the BOJ is not expected to make any major change to its forecast for a moderate recovery, Ueda is likely to warn of lingering uncertainty over the economic outlook, analysts say.

Political uncertainty further muddles the BOJ's policy outlook, as the ruling party gears up for a leadership race on October 4 after Prime Minister Shigeru Ishiba's decision earlier this month to step down.

A Reuters poll showed a majority of economists expect another 25-basis-point hike by year-end. But those surveyed are split on the timing with bets centering on October and January.

While global uncertainties give the BOJ good reason to go slow in rate hikes, stubbornly high food prices and a tight job market have led some hawkish members of its board to warn of the risk of keeping real borrowing costs negative for too long.

Japan's consumer inflation remains above the BOJ's 2% target for well over three years, with steady gains in rice and other food prices pushing up households' cost of living.

"If upward inflation risks heighten, the BOJ may need to act decisively as a guardian of price stability," hawkish board member Naoki Tamura told a news conference in late June.

The BOJ exited a massive, decade-long stimulus programme last year and raised short-term rates to 0.5% in January on the view Japan was on the cusp of sustainably achieving its 2% inflation target.

While Ueda has stressed the bank's resolve to keep hiking rates, he has vowed to tread cautiously on uncertainty over the impact of U.S. tariffs on Japan's economy.

Source: Reuters

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Manuel

Political

Energy

European powers will likely reimpose international sanctions on Iran by the end of the month after their latest round of talks with Tehran aimed at preventing them were deemed not serious, France's President Emmanuel Macron said on Thursday.

Britain, France and Germany, the so-called E3, launched a 30-day process at the end of August to reimpose U.N. sanctions. They set conditions for Tehran to meet during September to convince them to delay the "snapback mechanism".

The offer by the E3 to put off the snapback for up to six months to enable serious negotiations is conditional on Iran restoring access for U.N. nuclear inspectors - who would also seek to account for Iran's large stock of enriched uranium - and engaging in talks with the U.S.

When asked in an interview on Israel's Channel 12 whether the snapback was a done deal, Macron said:

"Yes. I think so because the latest news from the Iranians is not serious."

Iran's Foreign Minister Abbas Araqchi said later on Thursday that he had presented a "reasonable and actionable plan to E3/EU counterparts to avert an unnecessary and avoidable crisis in the coming days."

In a post on X, Araqchi said the proposal "addresses genuine concerns" and described it as mutually beneficial, but did not provide further details on what it entails.

E3 foreign ministers, the European Union foreign policy chief and their Iranian counterpart held a phone call on Wednesday, in which diplomats on both sides said there had been no substantial progress though the door was still open to try and reach a deal before the deadline expired.

The 15-member U.N. Security Council will vote on Friday on a resolution that would permanently lift U.N. sanctions on Iran - a move it is required to take after the E3 launched the process.

The resolution is likely to fail to get the minimum nine votes needed to pass, say diplomats, and if it did it would be vetoed by the United States, Britain or France.

Source: Reuters

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Manuel

Central Bank

Forex

New Zealand's finance minister is expected to announce a new central bank chief in the coming weeks, with economists hoping the move will signal the end of a tumultuous period in which both the bank's governor and chairman unexpectedly departed.

Whoever takes the reins of the Reserve Bank of New Zealand faces a tough task: repairing the reputational damage done by a deep downturn in the economy, while defending the bank's independence from a critical government.

"We face a test of trust and confidence in us as an organisation," interim Governor Christian Hawkesby said in a speech earlier this month.

"I want to assure you that we are resolutely focused on our mandate of delivering low and stable inflation in the medium term, and a resilient and enabling financial system,” added Hawkesby, who has confirmed he wants to remain in the job.

Former governor Adrian Orr sometimes wrong-footed financial markets with policy decisions and shocked them by resigning suddenly in March following a dispute with the government about punishing cuts to the central bank's budget.

The controversy eventually claimed the scalp of the RBNZ's chair Neil Quigley, who oversaw operations at the bank. Finance Minister Nicola Willis said she would have asked him to resign if he had not quit.

The centre-right government has become more vocal in other areas, with Prime Minister Christopher Luxton publicly saying he had told the RBNZ what he views they should do with interest rates.

Such pressure, reminiscent of what the U.S. Federal Reserve is facing, is unusual for the RBNZ, whose independence has largely been respected by previous governments.

"In the past, central banks (globally) were largely left alone to do that, but now it's becoming more challenging,” said John McDermott, who was chief economist at the RBNZ until 2019.

"Some politicians just want to take over... and there's been an element of that in New Zealand as well," without elaborating.

McDermott, who heads economic and public policy institute Motu, has been named by some local media as a possible applicant for the role. He declined to comment on the reports.

IN A STATE

The brace of resignations cap a difficult few years for the once highly regarded central bank.

The bank has faced criticism for abetting a surge in inflation by pumping billions of dollars of stimulus during the COVID-19 pandemic. It was then forced to engineer a recession with high interest rates to get prices back under control.

An internal review concluded its dramatic easing during COVID-19 was warranted, but that cut little ice with consumers and borrowers suffering a cost-of-living crisis.

The RBNZ has since cut rates by a steep 250 basis points to 3.0%, and flagged more easing to come. Yet, consumer and business confidence remains low, unemployment is at a near five-year-high and a record number of New Zealanders are heading offshore.

McDermott said the RBNZ needed to reestablish that it can manage inflation over the long haul.

"Trust is hard to win and easy to lose. And so it's going to be a long journey," he said.

WHO'S NEXT?

Along with McDermott, Dominick Stephens, currently chief economist at Treasury, is also a potential applicant for the top job. He declined to comment on his interest in the role.

Toni Gravelle, deputy governor at the Bank of Canada, said he was "no longer in the running."

Oliver Hartwich, executive director at New Zealand Initiative, said he believed an external candidate might be more successful at turning things around.

"It'll be easier for someone who's not connected to the current regime, and potentially even a foreigner, coming in and saying: ‘Well, I'm not here to make friends, and I don't have to pay too much attention to what's historically happened here. I will just implement what needs to be done'," Hartwich said.

Arthur Grimes, RBNZ chair until 2013, said holding onto senior staff with economics expertise was key.

"People who are just going to do a quiet job and run things, essentially technocrats, in the background," he said. “If you don't hear about the Reserve Bank from one month to the next or one quarter to the next, it's doing a good job."

In a wishlist of reforms, Westpac chief economist Kelly Eckhold said the next governor could improve transparency and accountability by introducing formal votes at all monetary policy decisions and holding a press conference after every one.

"Explicit votes, combined with an explanation of each member's rationale, would clarify both the options under consideration and the level of support for each," argued Eckhold.

"This reform would help anchor expectations and potentially reduce market volatility surrounding policy announcements."