The Reserve Bank of Australia Economically Out Of Touch
Many of us are doing it tough downunder. Stagnant wage growth over the last twenty years and now, rampant inflation is screwing the ordinary Australian. Is the Reserve Bank of Australia economically out of touch? Is Governor, Philip Lowe, who is instigating the fastest rise of interest rates on the cash rate ever seen in the nation’s history doing more harm than good? His warnings about the dangers of a wage-price-spiral are rooted in the experiences of the 1970s and not relevant to the causes of inflation in 2022-23. The RBA’s primary role is to protect the Australian currency and beating inflation is paramount to that function. If the governor, board, and bank’s economists do not properly grasp what is going on in today’s economy aren’t we flying blind?
Economics
