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Monetary policy

This Month

The Bank of England played Scrooge at its pre-Christmas meeting.

Bank of England pauses rate cuts as inflation picks up

The BoE did not join its rate-cutting peers in the US and Europe because, despite a flatlining economy, prices and wages have gathered pace.

  • Hans van Leeuwen
RBA governor Michele Bullock.

Traders dial up bets for February RBA rate cut

Money markets are slowly dialling up expectations for an early cut from the Reserve Bank in 2025. It’s a different story for New Zealand, which is now in a recession.

  • Updated
  • Cecile Lefort and Sarah Jones
US Federal Reserve chairman Jerome Powell was recast as The Grinch.

The Fed just killed the Santa rally

Jerome Powell gave investors a rate cut. But what sent Wall Street plunging was his message for 2025.

  • James Thomson
RBA Review panel member Renee Fry-McKibbin

Star pick for RBA board backed lower interest rates

Renee Fry-McKibbin was a monetary policy dove in 2022, according to Barrenjoey, backing in a low cash rate even as the central bank delivered supersized hikes.

  • Michael Read
Partisan appointments would have compromised the new board and tainted any decision to deliver pre-election rate relief.

Credit to Chalmers for non-partisan RBA picks

The Coalition’s fears that a Labor treasurer would stack the new board with political appointees have not been borne out. The crucial independence and credibility of the central bank have been preserved.

  • The AFR View
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Former Bendigo and Adelaide Bank CEO Marnie Baker and ANU economist Renée Fry-McKibbin will join the Reserve Bank’s monetary policy setting board.

Credible appointments will improve Reserve Bank board

Treasurer Jim Chalmers has selected two good candidates and should be congratulated for shoring up the RBA at a pivotal time in the inflation fight.

  • John Kehoe
Marnie Baker, Renée Fry-McKibbin, Jennifer Westacott, David Thodey,  Danny Gilbert and Swati Dave will come board members at the Reserve Bank.

Chalmers brings former bank CEO, economist on board in RBA overhaul

The appointment of ANU professor Renée Fry-McKibbin and former Bendigo Bank boss Marnie Baker sets the scene for the biggest shake-up of the central bank in decades.

  • Updated
  • Michael Read and John Kehoe
Sagging job ads  put rate cut on agenda

RBA could accept lower unemployment without inflation risk: economists

Others warn the jobs market may now be running too hot, and a longer period of elevated interest rates will be required.

  • John Kehoe and Michael Read
European Central Bank president Christine Lagarde.

ECB cuts rates for the third straight time

The European Central Bank indicated more cuts are to come as it sought to prop up the bloc’s struggling economy.

  • Mark Schroers, Jana Randow and Alexander Weber
US Federal Reserve chairman Jerome Powell hinted there may not be another rate cut this year.

US inflation ticks up but Fed ready for rate cut

Consumer prices rose 2.7 per cent in the year to November, up from 2.6 per cent in October, lifting the probability of another quarter point cut.

  • Updated
  • Matthew Cranston
RBA deputy governor Andrew Hauser.

Trump trade war would be felt in Australia, RBA says

Tariffs would have very little impact on the Australian economy, but there are bigger risks from any US-China trade war, Reserve Bank deputy governor Andrew Hauser says.

  • John Kehoe
RBA governor Michele Bullock at her press conference on Tuesday.

Dovish turn as RBA gains confidence in inflation fight

The Reserve Bank board has noticed that parts of the economy such as consumer spending and wage growth have been a bit softer than anticipated.

  • John Kehoe
RBA governor Michele Bullock addressing the media on Tuesday.

Bond traders eye back-to-back rate cuts

The Reserve Bank surprised the market by dropping a long repeated phrase that kept rate hikes still on the cards. Traders are now rapidly adjusting their expectations.

  • Cecile Lefort
Former vice president of the US Federal Reserve Randal Quarles.

Former US Fed vice chairman urges more RBA independence

Randal Quarles, a Donald Trump appointee who resigned from the central bank in 2021, said Australia should follow the American system.

  • Matthew Cranston
RBA governor Michele Bullock reconvenes the board this week.

The markets have got it wrong (again) on rate cuts

Bond traders are fully priced for some relief by April 2025 thanks to a couple of surprising data points. But it’s always the coldest just before sunrise.

  • Warren Hogan
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Australia’s economic problems have been brewing for years

We are in the most prolonged downturn since the 1991 recession. It’s time for a treasurer to do something about it.

  • John Kehoe
Argentina’s Diego Maradona, second left, is about to score his second goal against England in a World Cup quarter-final soccer match in Mexico City, Mexico.

Michele Bullock could be the Maradona of Australian central banking

The Reserve Bank governor is weaving through the inflation challenge with a hawkish comment here, a dovish quip there and a steady interest rate.

  • Paul Bloxham
A striking disconnect has emerged: RBA governor Michele Bullock and Treasurer Jim Chalmers.

The Reserve Bank is not smashing the jobs market

Claims the central bank is needlessly throwing vulnerable Australians out of work are not backed up by the statistics.

  • John Kehoe
Alan Oster is calling time at NAB.

Auld named chief economist at NAB, replacing Oster

Sally Auld will be National Australia Bank’s next economics chief following the retirement of Alan Oster after 32 years in the role.

  • Cecile Lefort
The Reserve Bank board is set for a shake-up.

Chalmers should pick ‘superforecasters’ for the new RBA board

The ideal member would have a deep and broad knowledge of many disciplines and be more likely to contribute to better predictions.

  • Huw McKay

Original URL: https://www.afr.com/topic/monetary-policy-5zu