Exclusive: Strip RBA board of rate-setting power: review | swrighteconomy
The Reserve Bank board would be stripped of its power to set interest rates and forced to explain why it fails to hit its inflation target, while senior staff would be barred from holding shares or government bonds under sweeping proposals put to the inquiry examining the institution.
“The status quo, in which monetary policy is set by a board mostly composed of corporate leaders with no experience in macroeconomics, has served Australia poorly,” he said. The committee would include five RBA economists plus four outside experts. The votes and reasoning of committee members would be made public after meetings, which would be reduced from 11 to eight a year.
Macroprudential regulations, such as requirements on interest rate buffers or how much of a commercial bank’s lending can flow to housing investors, have been used in recent years to prevent overheating in the housing market which could destabilise the banking sector. “The welfare of the Australian people would be improved by removing financial stability from the RBA’s mandate for monetary policy, leaving it to focus on the dual goals of a low and stable rate of inflation and the maintenance of full employment,” he said.This week, the Australian Greens used its submission to the RBA inquiry to call for the bank to have an objective of maintaining a stable ecology and climate to its objectives.
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Westpac’s King has a grim warning for RBAOPINION: Peter King worries inflation expectations are starting to become embedded. But for now, rising rates are adding momentum to his turnaround plan.
Read more »
Reserve Bank needs climate change specialists, review hearsA submission to the review of the Reserve Bank of Australia calls for it to account for the impact of climate change and net zero emissions in its monetary policy debates.
Read more »
The challenge for the Reserve Bank in Westpac’s resultOPINION: Westpac’s latest profit result show that Australian households and businesses are so far shrugging off the effects of the Reserve Bank’s monetary tightening.
Read more »
Santos, NSW government point fingers over Narrabri go-slowAs NSW Energy Minister Matt Kean pushes for a national coal and gas reserve, the Narrabri Gas Project remains mired in planning red tape.
Read more »
ASX higher as global shares rise after strong US jobs dataAustralian shares open higher on Monday after strong US jobs data on Friday raises hopes that the US Federal Reserve will adopt a less-aggressive monetary tightening stance going forward, pushing Wall Street higher.
Read more »
'Crazy moment': Huge shark leaps on board fishing boatA fisherman who captured a video of a huge shark leapt out of the water on to the front of his boat, coming face to face with those on board, described it as "a crazy moment".
Read more »