Former Reserve Bank boss Bernie Fraser attacks Bullock's rate hike strategy
Former Reserve Bank chief Bernie Fraser says three rate hikes this year harm workers but don't fix inflation.
Bernie Fraser headed the Reserve Bank in the 1990s. Fraser publicly criticised successor Michele Bullock's approach to fighting inflation.
Fraser said the three rate hikes this year won't do much to fix the inflation problem. Fraser said they are causing hardship to ordinary people.
The official cash rate sits at 4.6 per cent. Markets expect a roughly 50-50 chance of another increase before year-end.
Fraser argued the rate rises risk pushing unemployment higher. Unemployment already sits near multi-decade lows.
His comments overshadowed the Treasurer at a public event in Canberra on Tuesday night. This marked an unusual public criticism from a former Reserve Bank governor.
- 4.6 per cent
- Current cash rate
- 3 increases
- Hikes in 2027
- 7.5 per cent
- Fraser's 1995 peak rate
- Roughly 50-50 chance
- Year-end hike odds
Why it mattersFormer central bank leaders rarely criticise their successors in public. Fraser's remarks suggest disagreement about inflation strategy at a time when the Treasurer is defending the RBA's approach.
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