Australia parliament passes long-delayed RBA reforms

LONG-DELAYED reforms to the Reserve Bank of Australia (RBA) passed parliament on Thursday (Nov 28) after the ruling Labor government secured support from Greens lawmakers, paving the way for more changes at the country’s central bank.

The reforms, which were recommended by an independent review in 2023, included splitting the RBA board in two, with one group dedicated to monetary policy and the other focusing on operations.

The nine-member rate-setting board would still have six outside members, but the Liberal National opposition had blocked the Bill in parliament, arguing that it could be used by the Labor Party to include appointees friendly towards the current government.

The RBA has already adopted some of the recommendations from the review, including having fewer but longer policy meetings and holding a press conference after each decision.

The central bank has a dual mandate of maintaining price stability and full employment. It aims to keep inflation in a target band of 2-3 per cent over time, with a focus on the mid-point of 2.5 per cent. REUTERS