Michele Bullock, the Reserve Bank of Australia’s current deputy governor, will replace existing head Philip Lowe when his term expires in September. She will be the first woman in that role, but is not going to have time to dwell on the significance. Australia is amid an inflation crisis and a likely economic downturn, the RBA is due to commence a programme of reforms, and the central bank’s credibility has been dented by weak guidance during the pandemic.
Lowe said, during the Covid-19 pandemic, that rates would not rise until 2024 from their record lows of the time. In fact, they have risen 12 times since May 2022, and this contradiction is the principal reason Lowe was not offered another term.
Bullock must restore the bank’s reputation for transparent and accurate communication while dealing with a series of converging weather fronts: a weakening economy yet soaring housing costs, against a backdrop of geopolitical uncertainty and Australia’s energy transition.
Part of that communication will be a mandatory press conference after each rate decision, one of several recommendations of a review of the RBA. She will be scrutinised more than any previous governor. At least she knows the territory: Bullock is a lifer, who joined the RBA in 1985 and has not worked elsewhere.