New RBA governor will need hawkish credentials
With Jim Chalmers set to announce a new central bank head within days, Philip Lowe will be reading the room and preparing for his exit.
With Jim Chalmers set to announce a new central bank head within days, Philip Lowe will be reading the room and preparing for his exit.
There will be anxieties about the next person to take the seat, and their willingness to push back on pressure from Canberra.
Treasurer Jim Chalmers must reveal who will lead the Reserve Bank beyond September when current governor Philip Lowe’s term expires.
The governor of the Reserve Bank of Australia has started to talk about a narrowing path for the economy, and the need for a more potent tonic to cool inflation.
The RBA’s central narrative that it can afford to wait another two years before inflation falls back to within the 2 per cent to 3 per cent target band, might soon be tossed out entirely.
While Philip Lowe will give the budget his tick of approval, he harbours deeper worries about the economy and the direction of government policy that the fiscal statement does little to address.
Australians can act very childishly when it comes to responding to the often uncomfortable policy decisions made by its central bank.
The RBA’s current structure looks quirky, but Jim Chalmers is tampering with a board that delivered economic growth for 28 years.
Any pause in the RBA’s campaign of rate rises will be laced with a reminder it’s not finished tapping the policy brakes just yet.
Soft wage-growth data has kept alive the idea Australia might be different from the rest of the world in its ability to fight inflation.
Original URL: https://www.theaustralian.com.au/author/james-glynn/page/5