Imagine for just a few minutes that I am the RBA Governor. This is what I would be announcing next Tuesday at 2.30pm.
Thank you for coming.
The RBA board has agreed to leave the official cash rate where is currently stands.
Up until last quarter, domestic inflation has been falling and in an orderly fashion.
This national trend is in line with most other OCED nations.
The September quarter rise in the Australian consumer price index, was driven by factors that are not influenced by domestic interest rate settings.
Five things drove the slightly elevated September quarter CPI, these included:
- petrol prices
- building construction costs
- housing rents
- rates and other property charges/taxes, and
- electricity costs
Raising the cash rate will not slow these drivers.
Ironically if we lifted interest rates based on the most recent evidence we could see even higher inflation.
For example, a large part of the lift in housing rents is because of the rise in costs, of which higher interest paid by investors forms a large part.
At our most recent meeting the RBA board also discussed – and with my full support, we are hereby announcing – that the RBA aims to stop much of the jawboning that has taken place, before my tenure as Governor, when it comes to interest rate settings in Australia.
I believe that such activity undermines confidence, spooks investors and is just plain counterproductive.
As a result, the RBA and its board members have decided to remain largely out of the media – and will not make any comments regarding interest rates – until we are obliged to under our current charter.
To that end we do not intend – at this stage – to change the current official monetary policy setting for the next six to twelve months.
This is not an official forecast – as circumstances might change – but given the longer term inflation trend and, in line with our research and forecasts, – our reading right now is that the large lift in the official Australian cash rate is working to bring down inflation and hence they are on hold for the foreseeable future.
Governor of the Reserve Bank of Australia
Obviously I am not the RBA Guv, so I have to do other things for a crust, and what I mostly do is work on new residential projects.
And if you would like me to help bring your project to fruition – in either the subdivision, apartment or townhouse space – then give me a few details via the get in touch tab on this website and I will come back to you with a quote, timeframe and a recent example report.
I will, of course, discuss your needs and how best to present my recommendations.
I have helped over 1,200 projects across Oz and NZ do so over the past 30 years.
Maybe I can help you too?
Some may have noticed that I have been absent for a few weeks, mostly due to heavy work related travel and partially because, I like many of us, well at least the peeps I have spoken to in recent weeks, are pretty peeved with the way the world is heading.
I gave several presentations and a few workshops other the past month, and the general mood in the audience was, well, gloomy.
I am not making light of the recent world events, and I do believe that ‘The West’ has crossed yet another inflection point, but when you take a breather and consider the long view, things aren’t all that bad.
We should be telling our children and grandchildren this, instead of scaring them witless.
It was sad that this great article – from two of my favourite authors – was on page 24 of the Weekend Australia. Included like an afterthought, or maybe to toss in a titbit of positive balance, given the weekend paper was almost all doom and gloom.
For mine, such content should feature on the front page more regularly and largely is missing from our national discourse. Let’s talk about what we have done, and do well, and where the real opportunities lie and stop wallowing in pity, doubt and negativity.
PS My apologises for the tea bag stains. Rooibos for those that are interested.
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