Before the COVID-19 pandemic, the Reserve Bank of Australia was considered one of the leading lights in the global central banking circuit. For a large part of the last 30 years, inflation has been within the Bank's 2-3% target and the broader economy has not been in a technical recession once thanks in large part to strong monetary policy settings.
When the pandemic arrived, the cash rate was just 0.75%. It was quickly cut to 0.1% and Governor Philip Lowe strenuously argued that the nominal interest rate would not be taken below zero (unlike in Japan or Europe).
What happened afterwards is a series of undoubted mistakes - forward guidance, yield curve control, a lack of consistent communication chief among them. The combined frustration from investors, economists, and the general public has thrust the RBA's credibility into a spotlight it never wanted to have.
Now, 30 years on since its last major operational review, Australia's central bank will likely have to contend with some humongous changes. Among them - fewer meetings, a crystallised inflation target, and a separate monetary policy board.
And all this before we find out if the Governor gets to keep his job for a supplementary three-year term.
To discuss the Reserve Bank Review and what it means for investors, Livewire's Signal or Noise is back with an all-new episode. Joining moderator Hans Lee and permanent panellist Diana Mousina of AMP are:
Note: This episode was taped on Wednesday 3 May 2023.
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Why there is no credit crunch coming in 2024
Why Australia is already in a recession (but the RBA can’t afford to cut interest rates)
Signal or Noise: Are we at the start of the next house price boom?
How to invest in a market full of confusing signals
Signal or Noise: 10 things every investor should know right now
Why these fund managers think the hiking cycle is done (and what it means for your investments)
7 key themes (and 4 stocks) to watch this ASX reporting season
Why the ASX is trading like a recession is coming (and the NASDAQ isn’t)
The ultimate guide to Australian income investing
Is this the start of a second Global Financial Crisis?
Five commodities stocks successfully navigating geopolitical change
The biggest event in markets is happening right now
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