Okay I admit I did not want her to be governor. As far as I was concerned leadership at the RBA need new blood.
However her latest explanation of inflation just does not make sense.
Inflation was originally a supply side shock with similarities to the 70s. She now asserts it is home grown . BUT domestic demand is slowing fast. Passing on riding prices needs a strong economy like it was LAST year not a weakening one as it is now. Check out the Budget or RBA's forecasts if you want to.
She is talking tough on interest rate rises when she does not have to. Monetary policy works with a lag. Just one of those things are all those on fixed rated that have changed to floating rates over the year.
The monthly CPI come out today ( which should be the same as the quarterly but is not) and we shall get our first bit of inflation on whether the RBA is correct or not.
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