Reserve Bank of Australia Governor Lowe on Economics and Politics:
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Further tightening is likely to be needed to bring inflation back to target
- Whether monetary policy has more work to do remains to be determined
- Complex inflation picture, high uncertainty regarding forecasts
- At the August meeting, the Board of Directors will have updated economic forecasts and new data
- There has been a “big and rapid” tightening of monetary policy
- Highly conscious monetary policy is running backwards and the full effects are yet to be felt
- If economic growth slows over the next two years, it will take time for inflation to return to target
- Determined to bring inflation back to target within a reasonable time frame
About the bank review and changes to be implemented:
- The RBA Board of Directors makes changes based on an independent review
- Starting in 2024, the council will meet eight times a year, instead of 11
- Board meetings begin on Monday and conclude as usual on Tuesday
- A statement will be issued after the meeting announcing the decision of the board of directors, not the governor
- The Governor of the Reserve Bank of Australia will hold a media conference after each board meeting to explain the decision
- A quarterly monetary policy statement will be issued at the same time as the monetary policy decision
- The current board structure to remain the same
- The RBA Board of Directors will decide on some of the review recommendations at a later date
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