Just as we have the country’s smartest legal minds on the High Court and our best health practitioners setting vaccine policy, the review wants the best economists to set monetary policy.
Peter Martin, Crawford School of Public Policy, Australian National University
I graphed the average online rate for a $10,000 deposit against the Reserve Bank’s cash rate, going back to 2010. After seeing what that graph reveals, you’ll want to call your bank.
Many countries are dealing with a rapidly rising cost of living.
Billion Photos/Shutterstock
The first week of the new parliament will contain some depressing news, with Treasurer Jim Chalmers on Monday softening up the community to expect a “confronting” statement on the economy.
The extraordinary increase in house prices and debt means mortgage rates of 7% would be as painful to borrowers today as rates of 17% were decades ago.
For the past 30 years or so, the RBA has targeted an inflation rate of 2-3%. But the rationale for a rate that low was always weak, and has since broken down.
The independent review of the Reserve Bank should be headed by someone from outside the country say 12 leading economists in an open letter to the treasurer.
New Treasurer Jim Chalmers with Treasury Secretary Steven Kennedy, Reserve Bank Governor Philip Lowe, and Australian Competition and Consumer Commission chair Gina Cass-Gottlieb at parliament house on Wednesday.
Mick Tsikas/AAP
Politics with Michelle Grattan: Treasurer Jim Chalmers on the ‘spiky’ parts of Australia’s inflation problem
Michelle Grattan speaks with the New Treasurer Jim Chalmers as he intends to deliver a "pretty blunt, pretty frank" assessment of Australia's challenges to parliament soon after it returns
The share of the population in work has hit an all-time high as the share of the workforce underemployed has hit a 14-year low. The fresh low in unemployment will bring higher interest rates, and perhaps higher wages.
The Reserve Bank, as expected, has thrown its grenade into the election campaign, but neither government nor opposition can be sure which side will be more damaged, or advantaged, by the explosion.
The government used to set interest rates but it doesn’t anymore. If UAP really did try to deliver on an election promise to cap interest rates at 3% for five years, what would the consequences be?
Philip Lowe mightn’t be a household name but the Reserve Bank governor finds himself catapulted right into the centre of this election campaign, in which events are proving more important than policies.
Distinguished Professor of Economics and Public Policy, ANU Centre for Applied Macroeconomic Analysis (CAMA), Crawford School of Public Policy, Australian National University