14-7-2023 (SYDNEY) The Reserve Bank of Australia (RBA) has appointed its first female governor, Michele Bullock, as the central bank undergoes a major reorganisation. The announcement came after a public backlash over rising interest rates and Treasurer Jim Chalmers and Prime Minister Anthony Albanese declared that current governor Philip Lowe would not be reappointed. Lowe will leave the bank after finishing his current seven-year term on Sept. 17, marking the end of his 43-year career. Bullock is currently deputy governor and will become the first woman to lead the RBA in the country’s history.
Chalmers, in a press conference, stated that it was not unusual for a governor to only serve one term and he felt Bullock was the best candidate to lead the RBA through the upcoming reorganisation. “This is a history-making appointment… Michele Bullock will become the first woman to ever lead the Reserve Bank in this country,” Chalmers said.
The Australian government has been under pressure to remove Lowe for encouraging people to borrow in 2021 by saying interest rates were unlikely to rise until 2024, only to start hiking two years early in mid-2022. The RBA has since lifted rates 12 times to a decade-high of 4.1 per cent, adding hundreds of dollars to monthly mortgage repayments at a time when a cost of living crisis is already stretching household budgets. Lowe said it was possible rates would have to rise yet further to bring inflation under control.
Bullock is widely respected by economists and financial markets showed little reaction to the change. “It is a challenging time to be coming into this role, but I will be supported by a strong executive team and boards,” Bullock said.
The RBA is currently undergoing the biggest reorganisation in three decades, following an independent review into its operations that recommended sweeping changes to the way policy was formulated and communicated. Lowe is due to chair the next two policy meetings in August and September and is expected to accompany Chalmers to a Group of 20 meeting in India next week.
