The economist who called for RBA governor Philip Lowe to resign admitted it would be a “disaster” for the economy, but problems remain at the RBA.
commitment that interest rates would not be increased for three years after the onset of the pandemic.The unconventional tool policy involved pegging the three-year government bond rate – then 0.1 per cent – to the overnight cash rate target. It was underscored by formal guidance reinforced by the governor in policy decisions.Not alone
Dan Siluk, portfolio manager at bond fund manager Kapstream Capital, said that suggesting the whole Reserve Bank board needs an overhaul is too far-fetched. “The market gets up in arms because the central bank changes its policy but that’s because the facts change – in this case, they happened to have met their objective sooner than expected.”He said the market simply made the mistake of hearing what it wanted to hear.
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