A review of the RBA has recommended the creation of a new interest rate setting board, dominated by experts, which would meet eight times a year.
Households will have more time to absorb interest rate rises and have a better idea of how the economy will perform after a scathing review of the Reserve Bank urged a generational overhaul of the institution to bring it in line with its international peers., dominated by experts, meet 8 times a year rather than every month. The board would be separate from the current board that oversees the bank’s day-to-day operation.
The review panel was made up of international monetary policy expert Carolyn Wilkins, who sits on the Bank of England’s financial policy committee, the interim director of the Crawford School at the Australian National University, Renee Fry-McKibbin, and the secretary for public sector reform Gordon de Brouwer.
It would include the bank governor, their deputy and the Treasury secretary plus six people who have expertise in macroeconomics, the financial system, labour markets or the supply side of the economy.under which the RBA board is made up of non-monetary policy experts, mostly recruited from the business community. But it would bring the bank into line with its international peers.
It found the bank would have benefitted from “stronger decision-making arrangements” and a more specialist board during COVID when the bank not only took the cash rate to a record low but also printed hundreds of billions of dollars to support the economy. Stability of prices would remain keeping inflation between 2 and 3 per cent but the review backs the bank being more open about the path of interest rates to deal with price pressures.
Philippines Latest News, Philippines Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
RBA review updates LIVE: RBA to retain inflation target in shake upTreasurer Jim Chalmers to release RBA review; shadow treasurer Angus Taylor signals support for the creation of two central bank boards. Follow updates here.
Read more »
Reserve Bank Board to lose interest rate control in sweeping Australian policy reformThe Reserve Bank Board will lose its power to set interest rates under a huge shake-up to Australia's economic policy. Interest rate decisions are expected to be handed down to a second board of experts to minimise ongoing policy mistakes. It is expected to announce the government has given in-principle support to all of the 51 recommended changes from the Reserve Bank's review.
Read more »
Why the Reserve Bank could still hike interest rates after the April pauseThe Reserve Bank of Australia board landed on an interest rate pause when it met a fortnight ago. But there could be another increase on the horizon.
Read more »
Changes to RBA may affect ‘public debate’ around setting of interest ratesSky News Business Editor Ross Greenwood says planned changes to the Reserve Bank may fix the culture and change “public debate” regarding the setting of interest rates. The Reserve Bank board will be split in two as part of a significant shake-up in the way interest rates are set in Australia. “In many ways, the Reserve Bank over a long period of time has been something of a closed shop, almost beyond, if you like, criticism,' Mr Greenwood said.
Read more »
RBA to get second board in governance shake-upJim Chalmers will impose a sweeping overhaul of the Reserve Bank including creating two RBA boards – one that sets interest rates and one overseeing governance.
Read more »
The biggest shake-up in a generation: RBA board to lose rate setting powersThe review of the RBA calls for the governor to front a press conference after meetings to publicly explain why the bank has moved interest rates.
Read more »