RBA warns that losing public trust will make inflation harder to beat
RBA deputy governor Andrew Hauser says the central bank must explain its decisions to keep public trust as it fights inflation.
The Reserve Bank's deputy governor Andrew Hauser said the RBA needs to better communicate why it is raising interest rates to their highest level in 18 years. Speaking at the Australian National University, Hauser stressed that trust in the central bank is hard to win but easily lost.
When people trust the RBA to do its job, monetary policy works better and costs less. Inflation climbed to 4.3 per cent in September and, apart for a brief period in early 2025, has remained above the mid-point of the RBA's two to three per cent target since the end of COVID-19.
Businesses increasingly tell the RBA they doubt it will hit its target over the next five to ten years. If employers and workers lose faith that inflation will come down, they will demand higher pay and set higher prices, making the problem worse.
- Andrew Hauser, RBA deputy governor
- Speaker
- Australian National University, Canberra
- Venue
- 4.3 per cent in September
- Current inflation
- Two to three per cent
- RBA target band
Why it mattersIf Australians stop trusting the RBA, inflation becomes much harder and more costly to control, affecting everyone's wages and prices.
AustraliaAustralians face higher interest rates now, but the RBA's ability to bring inflation down depends on public confidence it can succeed.
✓ Claims checked against the source and corrected before publish. checked 3 h ago
