Philip Lowe and the Reserve Bank will face a moment of truth
Now the bank faces what is shaping up to be the biggest overhaul of the country’s economic policy in decades, with the RBA’s formal review. The release of the terms of reference for the review by Treasurer Jim Chalmers is imminent. This will mark the bank’s first review since the 1981 Campbell report – when Australians used Bank Cards, people kept $1 and $2 notes in their wallets and mortgage interest rates were capped by the government at the time. Reserve Bank Governor Philip Lowe has maintained an upbeat economic assessment throughout his tenure. The review was prompted by concerns about the bank’s handling of monetary policy prior to the COVID-19 pandemic. A series of articles in this masthead in April last year, outlining criticism among the bank’s economics, handling of its policies and governance structure, provided a staging ground for the demand for review. Both political parties went to the election promising a review. Chalmers describes his review of “RBA goals and objectiv