Michele Bullock is the ninth governor of the modern Reserve Bank and the first female governor.
She is a Reserve Bank lifer, having entered the RBA in 1985 immediately after graduating in economics from the University of New England.
Bullock rose through the payments policy department of the bank before moving to the currency group and being promoted to assistant governor in 2010. Before her promotion to deputy governor in the wake of Guy Debelle’s departure in March 2022, she headed the financial system group. She thus comes to the governorship as a veteran in financial system policy and management issues, as opposed to economics or financial markets (outgoing governor Philip Lowe, for example, had experience heading both the financial systems area and the bank’s economic area).
Bullock regards financial system policy as having dramatically increased in importance since she started in that area in the 1990s, saying this at a June conference:
I think the payments system used to be the plumbing; no one was interested in it and it was just there. It’s actually risen to prominence now and it’s a really important part of the economic ecosystem. There’s a payments ecosystem, but it’s part of the economy, and we’re after competition to lower the cost of payments; that’s what we want. But what has increasingly become obvious is that the safety and resilience of payments is really important as well. So we’ve got this dual issue now. We’ve been concentrating for so long on trying to get competition in payments and lower the cost of payments in the economy but, at the same time now, we’re going to have to start focusing on safety and resilience; so that’s going to be a challenge.
She most recently attracted controversy in June when, in a speech on full employment — an objective of the Reserve Bank — she said the bank forecast unemployment to rise to 4.5% for inflation to return to the RBA’s 2-3% target by 2025. This was interpreted as an unusually clear statement of the bank’s determination to force people out of work in order to lower inflation.
Bullock has also commented about the now-infamous “no rate rises until 2024” line from the RBA under Lowe, saying earlier this year:
we talked around the sorts of things that we thought were going to be important and we got a little bit fixated on wages and — the review makes this point as well — instead of focusing on saying ‘We want to get inflation back in target’, and leaving it at that, we actually went on to say: ‘And we’ll therefore be expecting this to happen to wages’ and ‘this to happen on demand’. So we muddied the communication, I think, and so we didn’t do as well as we could have there. I would say, no, we didn’t offer unconditional guidance at all, but I will do a mea culpa in terms of communication.
With Lowe committing the RBA to significantly stronger communication as a result of the review, Bullock’s communication performance will be scrutinised far more intently than any previous governor.
Anyone else find Lowe’s deputy taking over- a woman who has been part of the RBA furniture for decades- not exactly indicative of reform and change?
Yep. Lowe and Bullock are merely the visible cogs in a relentless, impersonal machine that runs on poverty, not wealth.
I have worked with and for Michelle for several years in the 1990s and we had a cordial relationship. What Keene fails to mention is that Michelle spent almost 2 decades as a researcher and policy official in the key departments of the Bank that study the economy and the operation of monetary policy. She built her reputation there in this field, but found a home in the payments realm when Stevens earmarked future senior appointments to a small clique of economists trained at top US universities, notably MIT. Michelle is highly pragmatic, is able to digest research and derive from it key insights for policy, as well as limitations. Her policy judgement is less likely to be swayed by the latest fashion in economic research; she is less likely to fall into the trap of projecting lessons from the economic experience and policy approaches of the US onto Australia’s situation. She understands the difference between being model informed versus being model dependent. This is a person who loves her country (a cheesy view, but must be evident in spades for such a position). She has high levels of personal integrity. Whether – in hindsight – she does a good job, largely depends on the cards dealt to Australia by the global economy.
Time will be the arbiter of her performance. I am not holding my breath for any exceptional outcomes that will lift this country out of mediocrity. Different face, same shyte.
It sounds like she’s fully indoctrinated!
All this research she was doing – you get that it was a complete waste of everyone’s time?
Like she may as well have been researching the Bible.
Economics is not a science. It’s a highly questionable set of theories which get more removed from reality and contradictory the more it pretends to be all science-y
And for the time she was reading the Bible the main religion has been neo-liberalism, and that has therefore a huge growth in household debt (currently $2 trillion in Australia).
It’s what caused the global financial crash. When the financial system collapsed and governments bailed it out in return for imposing austerity on the rest of the population.
And she’s been involved in financial system policy during this time?
At least if she did take on board the latest fashion in economic research it would show she’s capable of independent thought.
And with that she might doing the bleeding obvious thing and rein in bank lending including capping mortgages to 4 times salaries and banning 100% mortgages. See what that does to inflation and house prices.
‘Some of you may die, but it is a sacrifice I’m willing to make.’
Putting someone at the helm with 40 years at the RBA will drive reform and needed change pigs fly and the tooth fairy appears outside the GPO at midnight
Ms Bullock has been described as a conservative economist and an inflation hawk. If so, it is a worry. Neoliberal economics has wreaked enormous harm to equality and employment, in Australia and elsewhere, for the last 40 years.