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Michael Stutchbury

Treasurer v the RBA: Why Chalmers and Bullock are both right

Jim Chalmers says the economy is getting smashed by high interest, but it’s still running too hot for Michele Bullock’s central bank. The answer is simple: productivity.

How can the economy be “especially weak” as Jim Chalmers says but also too hot as Michele Bullock worries? Answer: it’s the supply side, stupid.

With productivity stalled, the economy just can’t grow any faster than the dawdle rate of the past year without risking more inflation.

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Michael Stutchbury is the former editor-in-chief and editor-at-large of The Australian Financial Review. Michael left in 2025 after more than four decades writing and editing national newspapers.

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    Original URL: https://www.afr.com/policy/economy/treasurer-v-the-rba-why-chalmers-and-bullock-are-both-right-20240904-p5k7v2