Government launches first independent review since the ’90s – صحيفة الصوت

Australia’s central bank will be reviewed for the first time in decades, an inquiry targeting its performance, inflation policy and the makeup of its board.

Chalmers said it was part of his government’s commitment to a broad review of monetary policy in Australia and aimed at “ensuring we have the world’s best and most effective central bank into the future”.

“Australia is facing a complex and rapidly changing economic environment, as well as a range of long-term economic challenges,” he said.

“This is an important opportunity to ensure that our monetary policy framework is the best it can be, to make the right calls in the interests of the Australian people and their economy.”

Two Australian experts and one with experience in England and Canada have been appointed to lead the undertaking.

Professor Carolyn Wilkins is an external member of the Financial Policy Committee of the Bank of England, Professor Renee Fry-McKibbin is interim director of the Crawford School of Public Policy at the Australian National University, and Dr Gordon de Brouwer has worked at Treasury and the Reserve Bank of Australia with more than 35 years of experience.

The inquiry’s terms of reference include “interaction of monetary policy with fiscal and macroprudential policy, including during crises”, as well as the appropriateness of the bank’s inflation targeting.

The RBA aims to keep inflation at 2–3 per cent on average and has not been subject to a review since the target was introduced in the 1990s.

Recent rate hikes have been aimed at keeping soaring inflation, sparked in part by rising energy prices, supply chain issues and the war in Ukraine, under control.

The independent review’s terms of reference also specifically mention the structure, experiences, composition and appointments process of the board, along with its governance and accountability arrangements.

It’s designed to question local and global experts and take account of analysis of reserve banks in the US, Canada, New Zealand and Europe.

Chalmers wants the report and recommendations on his desk by March next year.