Behind closed doors: Govt defends Reserve boss over meeting with big banks
The government has defended Reserve Bank governor Philip Lowe’s decision to give a private briefing to a group of bankers on interest rate hikes before making public statements.
RBA governor Philip Lowe speaks during a House of Representatives economics standing committee hearing at Parliament House in Canberra, Friday, September 16, 2022. (AAP Image/Lukas Coch)
Lowe will be questioned about the hikes to the cash rate at a Senate estimates hearing on Wednesday, as pressure mounts regarding his future in the top job at the Reserve Bank.
The RBA head gave a closed-door briefing to major banks last week, and cabinet minister Bill Shorten said there wasn’t anything wrong with that.
“I don’t think there’s anything untoward from a banker talking to bankers. Journalists talk to journalists in parliament … so I don’t see anything untoward,” Shorten told ABC Radio on Monday.
“I’m not going start into Monday morning coaching of Saturday’s game – for me, what’s important is how do we provide cost of living relief.”
The Reserve Bank moved last week to raise interest rates to 3.35 per cent, the ninth consecutive hike.
Lowe said it was likely further interest rates would be coming in a bid to tame inflation levels.
Treasurer Jim Chalmers has refused to comment on Lowe’s future as Reserve Bank governor, with his term in the role due to end in September.
A decision on whether his term should be extended is set to be made in coming months, following the handing down of a review into the Reserve Bank.
“The decision about the Reserve Bank governor … will be taken closer to the middle of the year in consultation with the prime minister and our cabinet colleagues,” the treasurer said.
“(The review) is an opportunity to think about the best structures and processes and objectives of the Reserve Bank going forward.”
Shorten said the recent interest rate increases had made the financial situation difficult for many families.
“People paying mortgages are the tip of the spear in the Reserve Bank strategy to tackle inflation, and that’s tough, because people have got mortgages to pay, and the nine increases are painful,” he said.
“They’re incredibly tough for people who’ve got no means of replacing the income that … they’ve now got to contribute to their mortgage.”
Crossbench senator Jacqui Lambie said while she didn’t want to influence the Reserve Bank’s decision, a change of leadership would be welcome.
“It’s always nice to get fresh blood in these places. I think he’s more than happy to go himself. I tell you what, we’re all belting him,” she told the Nine Network’s Today program.
“Seriously his tenure is up – if he doesn’t put up and say I’m going anyway, I think it’s time for some fresh blood.”
