On April 20, an independent assessment of the RBA by the Australian Treasury Department recommended that the bank reduce the number of interest rate decisions and set up an expert policy committee, a move that would bring the RBA into line with many global central banks.
Australian Treasurer Chalmers announced on Thursday that he agreed in principle to all 51 proposals, some of which would require changes to the RBA’s operating laws.
The review recommends legislative changes to take effect July 1, 2024. The report supported existing flexible inflation targeting, while recommending that the RBA’s financial stability role be legislated.
Other proposals include holding eight monetary policy meetings instead of 11, with members of an external committee speaking on rate decisions.
The reform is the RBA’s most significant reform since it began implementing inflation targeting in the early 1990s.