The latest RBA’s Statement On Monetary Policy (More than 80 pages) said very little which was new, with inflation not expected to land within their target zone until 2025, with lower growth and higher unemployment. They reconfirmed an expectation rates could still go higher.
They did try to defend corporate profits as not driving inflation…. hum… but not very successfully in my book.
The latest RBA’s Statement On Monetary Policy (More than 80 pages) said very little which was new, with inflation not expected to land within their target zone until 2025, with lower growth and higher unemployment. They reconfirmed an expectation rates could still go higher.
They did try to defend corporate profits as not driving inflation…. hum… but not very successfully in my book.
As discussed in The Conversation, the RBA was made subservient for a reason.
As prime minister, Chifley had the principle enshrined in the Commonwealth Bank Act of 1945, and it was later enshrined in the Reserve Bank Act of 1959.
The ultimate supremacy of the government over the Reserve Bank board was hard won – by Labor – and it is easy to imagine circumstances in which a government might need to use it.
Even the knowledge that the trigger is there, never pulled, lets the board know it is not able to go completely rogue and act against the wishes of a democratically elected government.
Chalmers ought to consider the wisdom of keeping his ultimate power in reserve. One day, Chalmers or his successors might wish they had it. The current recommendation to remove it is just plain wrong!
As discussed in The Conversation, the RBA was made subservient for a reason.
As prime minister, Chifley had the principle enshrined in the Commonwealth Bank Act of 1945, and it was later enshrined in the Reserve Bank Act of 1959.
The ultimate supremacy of the government over the Reserve Bank board was hard won – by Labor – and it is easy to imagine circumstances in which a government might need to use it.
Even the knowledge that the trigger is there, never pulled, lets the board know it is not able to go completely rogue and act against the wishes of a democratically elected government.
Chalmers ought to consider the wisdom of keeping his ultimate power in reserve. One day, Chalmers or his successors might wish they had it. The current recommendation to remove it is just plain wrong!
After the “surprise” rate hike on Tuesday, the RBA Governor spoke in Perth about the prospect ahead. Reading between the lines it does seem there remains a tightening bias at the RBA, and in line with our expectations, higher rates may still be on the cards, together with a rise in unemployment.
http://www.martinnorth.com/
Go to the Walk The World Universe at https://walktheworld.com.au/
After the “surprise” rate hike on Tuesday, the RBA Governor spoke in Perth about the prospect ahead. Reading between the lines it does seem there remains a tightening bias at the RBA, and in line with our expectations, higher rates may still be on the cards, together with a rise in unemployment.
http://www.martinnorth.com/
Go to the Walk The World Universe at https://walktheworld.com.au/
Journalist Tarric Brooker and I reconnected following my relocation, for the first in our series of bi-weekly afternoon chats about economics and politics. It may be a couple of months since our last, but in many ways, things are the same…
http://www.martinnorth.com/
Go to the Walk The World Universe at https://walktheworld.com.au/
Digital Finance Analytics (DFA) Blog
We’re Back (But Its The Same Old, Same Old) With Tarric Brooker... [Podcast]
The latest in inflation from the ABS reveals a higher level of underlying inflation, despite the4 base effects people were expecting to see. As result, the expectation for a further round of rate hikes extended in Australia, as the energy and gas prices continue to climb.
That said, some optimistic market analysts are call for rate cuts later in the year – but in your dreams… I am thinking!
http://www.martinnorth.com/
Go to the Walk The World Universe at https://walktheworld.com.au/
Where should accountability lay for the decisions of the Central Bank? There are many arguing that more independence is needed, so politicians can claim arms length influence only. On the other hand to date, this approach has not been working, and in a New Daily article Alan Kohler makes some interesting observations.
http://www.martinnorth.com/
Go to the Walk The World Universe at https://walktheworld.com.au/
Digital Finance Analytics (DFA) Blog
If The RBA Were A Company, The Governor Would Be Out Of A Job! [Podcast]
Where should accountability lay for the decisions of the Central Bank? There are many arguing that more independence is needed, so politicians can claim arms length influence only. On the other hand to date, this approach has not been working, and in a New Daily article Alan Kohler makes some interesting observations.
http://www.martinnorth.com/
Go to the Walk The World Universe at https://walktheworld.com.au/
