Bank of England’s Andrew Hauser appointed new Reserve Bank deputy governor

Oxford-educated Andrew Hauser will be given a vote on interest rate decisions affecting millions of Australians as the central bank undergoes its biggest overhaul in a generation.

Jim Chalmers has appointed Bank of England official Andrew Hauser as the Reserve Bank’s next deputy governor, filling a role that has been empty since governor Michele Bullock was promoted to the top job in mid-September and as the central bank undergoes its biggest overhaul in a generation.

Mr Hauser’s appointment was confirmed in a cabinet meeting on Monday morning to take on a role that will grant him a vote on interest rate decisions affecting millions of mortgaged households.

The 30-year veteran of the BoE is executive director for markets, responsible for managing the BoE’s balance sheet and Britain’s foreign exchange reserves, and has held a range of senior positions, including representing Britain as a member of the IMF’s executive board in Washington DC.

He will be the first foreigner to hold such a high position within the bank.

The Treasurer in a statement said Mr Hauser brought “international expertise” in economics and central bank operations, days ahead of Labor introducing legislation as part of a process to reinvigorate and refresh a venerable and independent institution that has come under fire for some of its decisions through the pandemic, including former governor Philip Lowe’s “guidance” that rates would stay at virtually zero until 2024.

“(Mr Hauser’s) appointment strikes the right balance between providing deep central banking experience and offering a fresh, global perspective to the work of the RBA,” Dr Chalmers said.

It is hoped the Oxford University-educated Mr Hauser – who, like Ms Bullock, also holds a masters degree in economics from the London School of Economics – will have completed the move from London to Sydney in time to attend the first RBA board meeting of 2024 in early February.

RBA governor Michele Bullock during a panel on the State of Economy during the ASIC annual forum in Melbourne last week. Picture: Aaron Francis/The Australian

A “deeply honoured” Mr Hauser said in a statement.

“I look forward to working closely with Michele Bullock, her senior team and the talented staff of the RBA to serve the Australian people, and to make a reality of the recommendations in the RBA review.”

Ms Bullock said Mr Hauser “has great experience and will bring a welcome external perspective to the bank and the board”.

BoE governor Andrew Bailey said he was “an outstanding central banker”.

The Australian understands Mr Hauser was chosen from a shortlist of four, which included an internal applicant alongside Australian and international candidates external to the RBA.

Ms Bullock in the near future is expected to announce a new assistant governor in charge of the RBA’s economics division, after Luci Ellis left to become Westpac’s chief economist.

Ms Bullock hiked the cash rate to 4.35 per cent at only her second board meeting on Melbourne Cup Day, and Mr Hauser will join the RBA with the inflation battle not yet won, amid growing uncertainty that the central bank will achieve its 2-3 per cent price growth target by late 2025.

Updated legislation to be introduced this week – likely on Wednesday – will implement key com­ponents of that review, including splitting the board into governance and monetary policy functions, removing a power for the Treasurer to overrule the RBA’s interest rate decisions, and clarifying the bank’s dual mandate of price control and full employment.

Ms Bullock has already confirmed that the bank will move from a monthly board meeting schedule to one every six weeks.

The monetary policy meeting will be held over two days instead of one, in order to give board members more time to debate issues and ask questions, and each meeting will be immediately followed by a press conference.