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Posted: 2023-07-13 21:58:59

Sorry to be the bearer of bad news Yohan, but don't expect this change to result in lower interest rates any time soon.

RBA governor Philip Lowe doesn't make the cash rate decision independently — he meets with the broader RBA board to determine what to do with the rate, and Michele Bullock has been sitting in on those meetings in her role as deputy governor ever since rates were increased in May 2022.

There's also nothing to suggest that this change in governor will see the bank change its approach.

Business editor Ian Verrender explains it better than me — here's what he told David Speers.

"What this means to interest rates is really absolutely nothing. I don't think there has been any criticism of the fact that the Reserve Bank has actually raised interest rates.

"Every Central Bank around the world in every developed nation has raised interest rates, many of them at a far greater pace than Australia has, and there are reasons why we've lagged in terms of the rate hikes. America is up around five, New Zealand is way above where we are, the UK and the European central banks both putting through double hikes just recently.

"So these changes will not affect monetary policy whatsoever.

"I guess from a positive point of view, we are at or near the peak in interest rates right now.

"We might have one more to go, so, you'd have to say Michele Bullock will probably not face the kind of public criticism that Philip Lowe has, but she was the deputy governor during this whole period and she has presided with Philip Lowe over these interest rate hikes."

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