Speech by Brad Jones, Assistant Governor (Financial System), Opening Remarks to FINSIA: The Regulators.
Reserve Bank of Australia (RBA) Feed Items
Technology and the Future of Central Banking at the RBA
—Speech by Michele Bullock, Governor, to the 60th Shann Memorial Lecture. This speech is being broadcast live.
Staff Appointment
—Media Release Number 2025-24: Dr Claude Lopez has been appointed as Head of Economic Research at the Reserve Bank of Australia.
Payments System Board Update: August 2025 Meeting
—At its meeting today, the Payments System Board discussed a number of issues, including the regulatory response to the CHESS batch failure incident in December 2024, the annual Assessment of the ASX clearing and settlement facilities against the Financial Stability Standards, the RBA’s oversight of international financial market infrastructures, the system wide resilience of the Australian payments system, the future of cash distribution arrangements, review of Merchant Card Payment Costs and Surcharging and global developments in stablecoins.
An AI-powered Tool for Central Bank Business Liaisons: Quantitative Indicators and On-demand Insights from Firms
—In a world of high policy uncertainty, central banks are relying more on soft information sources to complement traditional economic statistics and model-based forecasts. One valuable source of soft information comes from intelligence gathered through central bank liaison programs – structured programs in which central bank staff regularly talk with firms to gather insights. This paper introduces a new text analytics and retrieval tool that efficiently processes, organises, and analyses liaison intelligence gathered from firms using modern natural language processing techniques. The textual dataset spans around 25 years, integrates new information as soon as it becomes available, and covers a wide range of business sizes and industries. The tool uses both traditional text analysis techniques and powerful language models to provide analysts and researchers with three key capabilities: (1) quickly querying the entire history of business liaison meeting notes; (2) zooming in on particular topics to examine their frequency (topic exposure) and analysing the associated tone and uncertainty of the discussion; and (3) extracting precise numerical values from the text, such as firms' reported figures for wages and prices growth. We demonstrate how these capabilities are useful for assessing economic conditions by generating text-based indicators of wages growth and incorporating them into a nowcasting model.
How Costly are Mark-ups in Australia? The Effect of Declining Competition on Misallocation and Productivity
—There is substantial evidence that the degree of competition in the Australian economy has declined over the decade or so leading up to the COVID-19 pandemic. This has the potential to weigh on productivity, and in turn incomes, and so the welfare of the Australian people. In this paper we calibrate the general equilibrium model from Edmond, Midrigan and Xu (2023) to Australian microdata to answer the following question: If the degree of competition in the Australian economy had not declined from mid-2000s levels, how much higher would aggregate productivity and GDP be due to resources being better allocated across firms throughout the economy? The answer, according to this model, is 1–3 per cent. The model also suggests even larger economic costs once we account for other channels through which rising mark-ups affect the economy, though these are less precisely estimated.
Statements on Monetary Policy
—The Statement on Monetary Policy sets out the Bank's assessment of current economic
conditions, both domestic and international, along with the outlook for Australian inflation and output growth.
A number of boxes on topics of special interest are also published. The Statement is issued four times a year.
Statement by the Monetary Policy Board: Monetary Policy Decision
—At its meeting today, the Board decided to lower the cash rate by 25 basis points to 3.60 per cent.
RBA and APRA Update Their Memorandum of Understanding to Strengthen Cooperation to Support Financial Stability
—The Reserve Bank of Australia (RBA) and the Australian Prudential Regulation Authority (APRA) have today published an updated Memorandum of Understanding (MOU), to further strengthen their cooperation and coordination arrangements in support of financial stability in Australia.
The RBA's Dual Mandate – Inflation and Employment
—Speech by Michele Bullock, Governor, at the Anika Foundation Fundraising Lunch.
Granting of Overseas Clearing and Settlement Facility Licence to Clearstream Banking S.A.
—The RBA welcomes ASIC’s decision to grant Clearstream Banking S.A. a clearing and settlement facility licence.
Review of Merchant Card Payment Costs and Surcharging
—Media Release Number 2025-19: The Reserve Bank of Australia (RBA) has today released a Consultation Paper as part of its Review of Merchant Card Payment Costs and Surcharging. This follows an extensive public consultation process since the release of an Issues Paper in October 2024. The Payments System Board (PSB) has reached the preliminary view that it would be in the public interest to:
Project Acacia: RBA and DFCRC announce chosen industry participants and ASIC provides regulatory relief for tokenised asset settlement research project
—Project Acacia has today reached a significant milestone with a number of industry participants (see below) selected to explore how innovations in digital money and existing settlement infrastructure might support the development of Australian wholesale tokenised asset markets.
What Has Australian Macroeconomic Thought Achieved in the Past Century – And Where Can it Contribute in the Next?
—Speech by Andrew Hauser, Deputy Governor, to Mark the Centenary of the Economics Society of Australia, Australian Conference of Economists, Sydney – 9 July 2025. This speech is being broadcast live.
Statement by the Monetary Policy Board: Monetary Policy Decision
—At its meeting today, the Board decided to leave the cash rate target unchanged at 3.85 per cent.
Industry Consultation on the Future of the Account-to-Account Payments System
—The Reserve Bank of Australia and The Treasury welcome the release of a public consultation today by Australian Payments Network and Australian Payments Plus on the future of the account-to-account payments system.
Consultation on Guidance for the Australian Clearing and Settlement Facility Resolution Regime
—Media Release Number 2025-15: The RBA has commenced its consultation on Guidance for the Australian Clearing and Settlement Facility Resolution Regime.
HANK and the Transmission of Shocks to Demand and Supply
—In this paper we study the propagation of demand and supply shocks in a heterogeneous agent New Keynesian model. Calibrating the model to Australia, we explore how inequality in the model affects shock transition, as well as how shocks impact individuals differently across the distribution. Contrary to much of the literature, with a single asset in the model we find a dampening in the response of the real economy to a monetary policy shock, driven by falling consumption in the extremes of the distribution. This dampening is likely due to the high holdings of liquid assets by many households in the model, which allows these households to effectively smooth their consumption, emphasising the need to include further asset classes. In the case of supply shocks, we likewise find a dampened response of the real economy to both a labour disutility shock and a mark-up shock. These results highlight the need to explore models with more realistic asset classes in the Australian context.
Australia's Bond Market in a Volatile World
—Speech by David Jacobs, Head of Domestic Markets, to Australian Government Fixed Income Forum.
Joining the Dots: Exploring AustraliaÂ’s Economic Links With the World Economy
—Speech by Sarah Hunter, Assistant Governor (Economic), Economic Society of Australia (Queensland) Business Lunch.
Open the Door and See the Mountain: Reflections from a Recent Trip to China
—Speech by Andrew Hauser, Deputy Governor, to the Lowy Institute. This speech is being broadcast live.
Statements on Monetary Policy
—The Statement on Monetary Policy sets out the Bank's assessment of current economic
conditions, both domestic and international, along with the outlook for Australian inflation and output growth.
A number of boxes on topics of special interest are also published. The Statement is issued four times a year.
Statement by the Monetary Policy Board: Monetary Policy Decision
—At its meeting today, the Board decided to lower the cash rate target by 25 basis points to 3.85 per cent.
Fast Posterior Sampling in Tightly Identified SVARs Using 'Soft' Sign Restrictions
—We propose algorithms for conducting Bayesian inference in structural vector autoregressions identified using sign restrictions. The key feature of our approach is a sampling step based on 'soft' sign restrictions. This step draws from a target density that smoothly penalises parameter values violating the restrictions, facilitating the use of computationally efficient Markov chain Monte Carlo sampling algorithms. An importance-sampling step yields draws from the desired distribution conditional on the 'hard' sign restrictions. Relative to standard accept-reject sampling, the method substantially improves computational efficiency when identification is 'tight'. It can also greatly reduce the computational burden of implementing prior-robust Bayesian methods. We illustrate the broad applicability of the approach in a model of the global oil market identified using a rich set of sign, elasticity and narrative restrictions.
AustraliaÂ’s External Position and the Evolution of the FX Markets
—Speech by Christopher Kent, Assistant Governor (Financial Markets), to Australian Financial Markets Association/Bloomberg.
Women's Economic Empowerment in Australia
—Speech by Michele Bullock, Governor, Chief Executive Women Annual Dinner.
Boundedly Rational Expectations and the Optimality of Flexible Average Inflation Targeting
—Expectations play a central role in the transmission of monetary policy, but how people form expectations is widely debated. We revisit optimal monetary policy design in a model with behavioural expectations that nest rational and adaptive learning beliefs as special cases, and approximates several alternative expectations theories, such as myopic or level-k expectations. Optimal policy is a weighted average inflation target plus adjustments for belief persistence and constraints faced by the central bank (information frictions and the zero lower bound). Optimal policy is well-approximated in all cases by flexible average inflation targeting, where we make explicit what average and flexible mean.
Consultation on the Future System for Monetary Policy Implementation in Australia – Summary of Stakeholder Feedback
—Media release number 2025-12: The Reserve Bank of Australia (RBA) today released a summary of the stakeholder feedback received in response to a consultation paper titled 'The Future System for Monetary Policy Implementation'. The feedback informed recent changes to the configuration of the RBA's open market operations (OMO), as discussed in a speech by Assistant Governor (Financial Markets) Christopher Kent.
Joint APRA-RBA Statement on Use of the RBA's Overnight Standing Facility
—Media release number 2025-11: The Reserve Bank of Australia's (RBA) new approach to monetary policy implementation – the 'ample reserves with full allotment' system – allows eligible counterparties to borrow as many reserves as they demand at open market operations (OMO). The RBA has recently announced some important updates to the operation of this system for monetary policy implementation, including the configuration of its OMO and the role of the overnight standing facility.
The RBA's Monetary Policy Implementation System – Some Important Updates
—Speech by Christopher Kent, Assistant Governor (Financial Markets), KangaNews Debt Capital Markets Summit. This speech is being broadcast live.
Statement by the Monetary Policy Board: Monetary Policy Decision
—At its meeting today, the Board decided to leave the cash rate target unchanged at 4.10 per cent and the interest rate paid on Exchange Settlement balances at 4 per cent.
RBA and ASIC Act on Deep Concerns with ASX
—The Reserve Bank of Australia (RBA) and the Australian Securities and Investments Commission (ASIC) (the regulators) have taken further steps to address their increasing concern over the management of operational risk at ASX, following the CHESS batch settlement failure incident that occurred on 20 December 2024.
Monetary Policy: Forward Looking and Data Dependent in the Face of Uncertainty
—Speech by Sarah Hunter, Assistant Governor (Economic), The Australian Financial Review Banking Summit.
Renewal of Bilateral Local Currency Swap Agreement with Bank of Japan
—Bank of Japan and Reserve Bank of Australia have renewed the Bilateral Local
Currency Swap Agreement on March 17, for a period of three years.
$5 Banknote Theme Celebrates First Nations Connection to Country
—The Reserve Bank of Australia (RBA) is today announcing the theme for the updated $5 banknote, which will honour the enduring emotional, spiritual, and physical connection of First Nations peoples to Country.
Proposed Decommissioning of the Bulk Electronic Clearing System – RBA Risk Assessment
—The Reserve Bank of Australia today released its risk assessment into the payments industry’s proposed decommissioning of the Bulk Electronic Clearing System (BECS).
Monetary Policy in a VUCA World
—Speech by Andrew Hauser, Deputy Governor, The Australian Financial Review Business Summit.
Bank Indonesia and Reserve Bank of Australia Renew the Bilateral Currency Swap Arrangement
—Media Release Number 2025-04: Bank Indonesia (BI) and Reserve Bank of Australia (RBA) have renewed and strengthened the Bilateral Currency Swap Arrangement (BCSA) on March 4 2025, for a period of five years. This agreement was signed by Governor Perry Warjiyo and Governor Michele Bullock. This follows the initial agreement which was signed in December 2015 and has been renewed thereafter.
Why Productivity Matters
—Speech by Michael Plumb, Head of Economic Analysis Department, Australian Business Economists Annual Forecasting Conference.
Opening Statement to the House of Representatives Standing Committee on Economics
—Opening Statement by Michele Bullock, Governor, to the House of Representatives Standing Committee on Economics. This speech is being broadcast live.
Statement by the Reserve Bank Board: Monetary Policy Decision
—At its meeting today, the Reserve Bank Board decided to lower the cash rate target by 25 basis points to 4.10 per cent and the interest rate paid on Exchange Settlement balances to 4 per cent.
Are Investment Tax Breaks Effective? Australian Evidence
—Using Australian tax and survey data, we exploit discrete eligibility cut-offs to estimate the effect of several business investment tax breaks, including tax credits and instant asset write-offs, implemented over the past 15 years. Policies implemented during the global financial crisis increased investment. Responses are larger for unincorporated businesses, possibly reflecting reduced efficacy of investment stimulus under Australia's dividend imputation system. However, we find mostly no evidence of an effect for other investment policies, including those implemented to address the COVID-19 pandemic.
Statement from the Governor of the Reserve Bank of Australia
—The Reserve Bank of Australia welcomes the appointment of new members to the Governance Board and Monetary Policy Board.
Shedding Light on Uncertainty: Using Scenarios in Forecasting and Policy
—Speech by Sarah Hunter, Assistant Governor (Economic), University of Adelaide South Australian Centre for Economics Studies (SACES) Lunch.
The Future of the Payments System
—Speech by Brad Jones, Assistant Governor (Financial System), AusPayNet Summit 2024.