Speculation surrounding the future leadership of the Reserve Bank intensifies as the opposition expresses its satisfaction with the potential renewal of Dr. Philip Lowe’s contract as governor.
Despite an upcoming official announcement regarding the central bank’s leadership, opposition finance spokeswoman Jane Hume advocates for Dr. Lowe’s reappointment, citing the importance of consistency in managing the economy amidst the current cost-of-living crisis.
Senator Hume lauds Dr. Lowe’s qualifications and defends him against unfair demonisation by the Labor government, emphasising that his decision to raise interest rates was a necessary step to combat high inflation.
“The government has unjustly blamed him for the high rates,” she expressed, adding, “Poor old Philip Lowe is simply doing his job.”
While the government remains tight-lipped about potential candidates to replace Dr. Lowe, Assistant Treasurer Stephen Jones acknowledges the presence of outstanding candidates from which the government can choose. Speculated names include Treasury secretary Stephen Kennedy, Finance secretary Jenny Wilkinson, RBA deputy governor Michele Bullock, and esteemed former RBA officials David Gruen and Guy Debelle. An announcement regarding the Reserve Bank’s leadership is expected in the coming weeks.
However, not all voices align with the need for continuity within the RBA.
Greens senator Nick McKim argues that the problem lies not only with the leadership but also with the bank’s policies. He emphasises the necessity for a leader who can accurately identify the causes of inflation and respond appropriately.
Senator McKim even proposes the progressive Greek-Australian economist Yanis Varoufakis, a former Greek finance minister, as an ideal candidate for the position.
Dr. Lowe has faced criticism for the Reserve Bank’s firm stance on raising interest rates, which has placed a burden on mortgage holders already grappling with the increasing cost of living. Additionally, he has faced backlash for his previous statement assuring Australians that there would be no rate hikes until “at least 2024.”
Since May 2022, the RBA has raised its cash rate 12 times, with brief pauses in April and this month, resulting in a current cash rate of 4.1 per cent.
*With AAP
