No interest rate cut in next six months: RBA governor Michele Bullock

Michele Bullock said a near-term rate reduction 'doesn't align with the board's current thinking', meaning mortgage holders face a wait for relief amid cost-of-living pressures.

Rosie Lewis and Mohammad Alfares

less than 2 min read

August 6, 2024 - 1:29PM

Reserve Bank governor Michele Bullock. Picture: John Appleyard/NewsWire

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Albanese congratulates Australian Olympians

Staff writers

Prime Minister Anthony Albanese has congratulated members of Australia's Olympic team, telling them they have given "so much pleasure and excitement and pride to the whole country."

Made a special call to our incredible @AUSOlympicTeam in Paris this arvo. pic.twitter.com/acsknYT2Ud
— Anthony Albanese (@AlboMP) August 6, 2024

A video posted to Mr Albanese's X account captures his phone calls with Australian Olympians in Paris, including Kyle Chalmers, Caitlin Parker, Shayna Jack and Harry Garside.

Joining Mr Albanese for the calls from his couch in Canberra was his dog, Toto.

Mr Albanese confirmed he had been getting up "very early" to watch the Olympics, and called Australia's Olympic team "incredibly inspirational".

"Well done to all of you," Mr Albanese said.

– Lily McCaffrey

Albanese, Wong 'ignored warnings' on UNRWA

Staff writers

Opposition home affairs spokesperson James Paterson says it is "utterly offensive" that the "hard-earned money" of Australians "is being sent to an organisation that employs terrorists in Gaza."

This comes after the United Nations found that nine employees of UNRWA “may have been involved” in the October 7 attack on southern Israel, and had been fired.

The Australian government paused funding to the organisation in January amid allegations its staff members were involved in the October 7 attacks.

The funding was resumed in March when Foreign Minister Penny Wong said: "The best available current advice from agencies and the Australian government lawyers is that UNRWA is not a terrorist organisation and that existing and additional safeguards sufficiently protect Australian taxpayer funding."

On Tuesday, Senator Paterson said the Prime Minister was warned that his decision to increase funding for UNRWA while it was under investigation was a "massive risk".

"He was warned that Australian taxpayer dollars could ultimately go to an organisation that employs terrorists," Senator Paterson said on Sky News.

"We begged him not to resume that funding because of this risk.

"But he and the Foreign Minister ignored that advice, ignored those warnings, resumed that funding and now they are complicit in funding an organisation that itself has admitted it employed at least nine people who participated in the 7 October atrocities."

– Lily McCaffrey

Rates on hold a relief for mortgage holders: Lawrence

Staff writers

Labor MP Tania Lawrence says the RBA board's decision to leave the cash rate target unchanged at 4.35 per cent is a "great relief" for mortgage holders.

"But also though, I think there is some comfort that the underlying inflation is actually moderating, that the measures that the government is rolling out, from supporting households, supporting business, is actually supporting the efforts of the RBA governor," the member for Hasluck said on ABC's Afternoon Briefing program.

However, Coalition MP Andrew Wallace, who also appeared on the program, criticised the government's fiscal policy.

"What we've seen and heard from the RBA governor today is that inflation and rates are not going to come down anytime soon," the member for Fisher said.

"It's often been described as the Reserve Bank having both feet on the brake and Jim Chalmers with both feet on the accelerator.

"Fiscal policy and monetary policy are not working in conjunction with each other and that is why the RBA has had to hike interest rates on 12 occasions.

"What that means is that the average Australian with a mortgage is now paying somewhere around $22-24,000 more than what they were paying when we were in government."

Ms Lawrence hit back at Mr Wallace's comments, stating: "Quite honestly, to suggest that those initial increases in inflation was somehow a consequence of the Labor government being elected in May 2022 is either a complete sign of a lack of sophisticated understanding of how the economy works or wilful misinformation to his electorate, to business and to industry.

"There was $30bn of excess money paid to billionaires no less on the back of Covid payments, to people, to business, who didn't need it, that were making a profit, that added to inflation that we [Labor] then had to tackle and deal with.

"What you have now is nine months of rates on hold, that is an absolute consequence of a sensible government that has been banking its revenue profits, over 80 per cent of our additional revenue was banked, not like under the Liberals and Nationals which were spending and they only banked 40 per cent."

– Lily McCaffery

RBA, government 'punishing mortgage holders': Greens

Staff writers

Greens MP Max Chandler-Mather has criticised the Reserve Bank board's decision not to cut interest rates, accusing the RBA and the government of "punishing mortgage holders and renters for an inflation crisis caused by corporate price gouging".

This follows the RBA board's announcement on Tuesday afternoon that it would leave the cash rate target unchanged at 4.35 per cent.

"By refusing to cut interest rates the RBA & Labor are punishing mortgage holders & renters for an inflation crisis caused by corporate price gouging," Mr Chandler-Mather wrote on X.

"People are skipping meals just to make their mortgage repayments and rents while the big 4 banks posted a $15bn half year profit."

By refusing to cut interest rates the RBA & Labor are punishing mortgage holders & renters for an inflation crisis caused by corporate price gouging. People are skipping meals just to make their mortgage repayments and rents while the big 4 banks posted a $15bn half year profit.
— Max Chandler-Mather (@MChandlerMather) August 6, 2024

– Lily McCaffrey

Strict Covid vaccine mandates were a mistake: Perrotet

Alexi Demetriadi

Former NSW premier Dominic Perrotet. Picture: Gaye Gerard/NewsWire

Former NSW premier Dominic Perrottet has criticised the “strict enforcement” of mandates during the Covid pandemic, saying it was “one mistake” Australian governments got wrong as he gave his departing valedictory speech.

Mr Perrottet, who will exit parliament this week to take up a job in Washington DC with BHP, praised the “real team effort” during the pandemic – his decisions and policies as premier to reopen the state have been lauded – but called the mandates “wrong”.

“While we didn’t get everything right, I believe we got more right than wrong,” Mr Perrottet told parliament this afternoon.

“And without dwelling on every decision, I believe it's important to point out one mistake which was made by governments here and around the world, the strict enforcement of vaccine mandates.”

Mr Perrottet said that while health officials and governments were acting with the “right intentions”, he said he believed the law should have “left more room and respect(ed) freedom”.

“Vaccines saved lives… but ultimately mandates were wrong,” he said, adding that personal choice “shouldn't have cost” people their jobs.

“If a pandemic comes again we need to get a better balance – encouraging people to take action whilst at the same time protecting people’s fundamental liberty.”

The former premier did praise his relationship with his then Victorian counterpart Dan Andrews – who he referred to as “Dictator Dan” while calling himself “Domicron” – and said the interstate collaboration during that period should be replicated moving forward.

Important to get public servants back to office: Park

Staff writers

NSW Health Minister Ryan Park. Picture: Simon Bullard/NewsWire

NSW Health Minister Ryan Park says it is "really important" that public servants get back into the office, following a new directive issued by the NSW Premier's Department advising that employees should work principally from the office.

"What the Premier and the Department of Premier and Cabinet is simply saying is that we need to have people back into our offices and the reason for that is because it's really important for mentoring, it's important for professional development, it's important for socialisation and connection and building up that knowledge of issues that people are working on," Mr Park said on the ABC's Afternoon Briefing program.

"Obviously people will still be able to work from home but what the emphasis is now on is coming back to work, making sure that understanding that your place of work is an important place."

Mr Park said working from the office was particularly important in healthcare.

"We are often dealing with issues that are multifactorial and that means that we need experts from a variety of different areas," he said.

"It's really important we have those robust discussions and people can have those discussions in a face-to-face forum."

Mr Park also addressed the global shortage of intravenous fluids, and said the NSW health department was centralising and making sure it had "tight controls" of supplies.

"We are due to get additional supply and we are regularly getting additional supply at the moment but it is patchy in terms of its consistency," Mr Park said.

"Until we're through this difficult period, we are going to be fairly stringent about the use of IV and the way in which it's controlled and managed.

"Obviously it will always be done in a way that's clinically appropriate and clinically safe, but it is a challenge.

"But I am confident in the controls NSW have to manage this."

– Lily McCaffrey

Bullock defends call not to lift rates as high as elsewhere

Rosie Lewis

Michele Bullock has defended the Reserve Bank’s decision not to lift interest rates higher as other countries have done, saying the RBA had chosen a “narrow path” to bring inflation back down.

Pressed on whether she was concerned about a policy misstep, Ms Bullock said: “We are trying our best to think where we think things will be and how high we have to have interest rates in order to deliver a low inflation rate, but it's inherently uncertain.

“We didn't go as high as the Fed (Federal Reserve). Our interest rates are lower and that's been used against us … Some commentators are very certain that we haven't gone high enough and we need to go more," the RBA governor said.

“That I think means that we're maybe not quite as restrictive as some other countries … We think we're restrictive, but we've chosen that because we've deliberately tried to follow this narrow path of bringing inflation back down at the same time as we are preserving what we can in the labour market. It's uncertain, and we are very alert to the risks, but we're doing our best.”

Likelihood of a rate hike hasn't increased: Bullock

Rosie Lewis

The head of the RBA Michele Bullock says the likelihood of a future interest rate hike hasn’t increased since the board’s last meeting.

“I would say that the board, though, are remaining very vigilant to the risks that it will continue to shift, that our getting back to target will continue to shift out. Now they think it's where we are at the moment, in terms of our central forecast we're fine, but if it looks like that's shifting out again, then I think … the likelihood or the probabilities of an interest rate rise do increase,” she said.

“Over the last few meetings, some of the data we've had have just raised the alert a little bit for the board and that's why you will have seen in some of the statements, that statements have highlighted vigilance to the upside, not ruling anything in or out, but vigilance to the upside.”

Ms Bullock earlier revealed the RBA board seriously considered a rate rise at its August meeting, with inflation forecast to come back into its target band of 2 to 3 per cent at the end of 2025.

"It (a rate rise) was a very serious consideration," Ms Bullock said.

Bullock receives 'quite distressing' letters

Rosie Lewis

Reserve Bank governor Michele Bullock at a media conference on Tuesday. Picture: John Appleyard/NewsWire

RBA governor Michele Bullock says she has received some “quite distressing” letters from Australians, pointing out it’s not just interest rates but also the cost of living “hurting those people”.

She said inflation had been high for a few years, which some mortgage holders weren’t used to seeing and they don’t want to see prices of their essentials going up at the rate they are.

“The most important thing that we, I and the board, can do is to get that inflation rate back down. So I do understand that,” Ms Bullock said.

“I do get letters that tell me this. I do understand that. But really getting inflation down is really the key to this ultimately being resolved so that households can just get on with their lives and not have to worry about this."

Asked if it affects her personally, Ms Bullock replied: “It does affect me personally. I do find it difficult to read some of them (the letters). I can't respond to every single letter I receive, some I do try to respond to, but it's difficult to read about.”

Chalmers is 'complacent' about inflation: Taylor

Staff writers

Opposition treasury spokesperson Angus Taylor has accused the government of being "complacent" about inflation, following the RBA board's announcement it would leave the cash rate target unchanged at 4.35 per cent.

"It is clear that inflation is running the economy, not the government," Mr Taylor said.

"But we're also fighting on a second front, which is a household recession, where we haven't seen any growth in GDP per capita for five quarters, indeed for four of those quarters we've seen it going backwards, we're seeing a record level of insolvencies and we're seeing a renewed level of volatility and instability in economic and particularly in financial markets around the world and here in Australia."

Mr Taylor said Australia was behind other countries in terms of dealing with inflation and economic growth.

"Since December last year, we're the only one of our peer major countries where we've seen an increase in inflation, core inflation, not a reduction," he said.

"If the government had broken the back of inflation, we wouldn't be in this situation."

Mr Taylor said Treasurer Jim Chalmers was "complacent about inflation".

"We see that in the forecasts," Mr Taylor said.

"He's out of touch and he's out of his depth and the result is we still have a long long way to go in fighting inflation and the Reserve Bank's comments today underscore just how tough this fight is proving to be and the degree to which this government, after three failed budgets, has absolutely failed to deal with the issues that we're facing."

– Lily McCaffrey

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