Reserve Bank interest rate decision will continue punishing public

Australia, three ratio deductions where it should now be, in recent years, despite clear evidence that inflation in Australia is below the RBA target group, a strict ideological reserve bank monetary policy board that decides to reduce interest rates from 3.85 percent.

The RBA’s Monetary Policy Committee entered the meeting today after the last November could not reduce the interest rates in which inflation orbit became clear, and later in April, Trump’s liberation day tariff’s schedule was only far away for hours away.

Now, in order to challenge the open evidence that inflation returned to the target group for inflation for inflation, it has taken interest rates again despite the permanent weak demand in the economy. Members of the Monetary Policy Committee voted 6-3 to keep the rates on waiting.

Why why?

After salary expression“A little more information to verify that inflation will reach 2.5 percent on a sustainable basis”. Although this acknowledges that higher growth forecasts may be proved from the beginning of the year, “The turntable is a risk of being a little slower than expected before, which can lead to growth that is ongoing in bulk demand and a sharper deterioration than expected now.”

Immediately after the decision, a media statement, Treasurer Jim Chalmers skillfully demonstrated the evidence of why RBA’s decision was so bad.

The latest monthly inflation figures showed that both the headline and the underlying inflation were in the lower half of the target group of Australia’s reserve bank for the first time since August 2021. The underlying monthly inflation has shown that RBA’s target group is at the lowest level for six months and that it has been at the lowest level since November 2021. In official three -month figures, both the title and the underlying inflation have returned for both headings. 6.1 percent when we come to the office, now 2.4 percent.

The results of Chalmers’ expression are clear – RBA’s decision has no evidence. The need to expect “a little more information” contradicts the net data currently available. What is hidden after the collection is the ideological obsession that the monetary policy needs to use the blunt tool long after the RBA’s need to use the blunt tool.

And this is a obsession that will always be applauded in the darker recesses of the comments that should always be higher interest rates, the punishment of households and workers at all times, and inflation is always a wage -priced spiral and low efficiency.

However, others were not satisfied with the decision. Pradeep Philip, President of the Deloitte Access Economics Economics, said, “A cautious reserve bank of Australia, even if the global economy has become more uncertain and volatile, the ‘waiting and visual approach to inflation’ voted according to inflation. stated.

It is almost impossible to create a consistent line in the Bank’s statements about uncertainty and the role of future data. He stated that uncertainty is a reason to reduce the proportions and to keep the rates on waiting, at the same time, he decided to reduce the rates in the absence of knowledge and to keep the rates on waiting for more information. Apparently, the only consistency seems to be trying to work to explain its reluctance to stop punishing households.

The problem with the RBA is the problem of making ideology -based decisions rather than evidence, and ultimately weaken the case for the independence of the Central Bank. The RBA’s Monetary Policy Committee should look at it because Donald Trump regularly saves the US Federal Reserve President Jay Powell because he does not reduce interest rates and guarantees that he will appoint someone who will submit to his whims when Powell’s era ends.

Chalmers is now good to think about it, considering that it is the creation of the Monetary Policy Committee that now two huruyan.

If the RBA wants to avoid ending in a political environment in which politicians open it and eliminate its independence, it should stop acting on ideology and begin to follow the evidence. Instead, after three failures since last November, Trump seems determined to react to a react.