Chair's foreword

The Standing Committee on Economics’ biannual hearings with the Reserve Bank of Australia (RBA) have been an important mechanism to provide parliamentary scrutiny of the functions and decisions of Australia’s central bank for nearly 30 years.

On 22 September 2025, the RBA appeared before the committee for the first time since the commencement of the 48th Parliament. On behalf of the committee, I thank the Governor, Michele Bullock, and other representatives of the RBA for attending the hearing.

The public hearing highlighted the strength and resilience of the Australian economy in 2025. The RBA had eased monetary policy over the year, reducing the cash rate by 75 basis points to 3.6 per cent, maintaining a commitment to keep inflation within the target range and promote full employment. At the time of the hearing, inflation had fallen from its 2022 peak of 7.8 per cent and sat between 2 and 3 per cent, while unemployment remained low at 4.2 per cent.

Beyond monetary policy, the committee examined a wide range of issues relating to Australia’s current economic position. Australia is not immune from the global trend of subdued productivity growth, with the RBA’s assumption downgraded to 0.7 per cent annually, though opportunities exist in areas such as green energy and artificial intelligence. Global developments were also discussed; while trade tensions have increased over the period, fears of a full-scale trade war have eased. These dynamics warrant vigilance given potential spillovers to Australian demand, inflation and financial conditions, and the RBA continues to monitor risks to Australia’s economic growth.

The public hearing in September was also the first since the introduction of major governance reforms to the RBA earlier in 2025. The reforms undertaken by the RBA have strengthened transparency, enhanced the quality of public communication and improved the governance structure of the institution. The establishment of separate Monetary Policy and Governance Boards has enabled a clearer focus on monetary policy and institutional oversight. As Australia navigates global uncertainties, the RBA is committed to strengthening its modelling, scenario analysis and forecasting capabilities. These improvements will support more robust policy formulation and ensure the bank remains responsive to emerging developments.

Other significant themes emerged through the hearing, including the RBA’s work to improve the efficiency and competitiveness of the payments system through its review of retail payments regulation. Access to credit for businesses, particularly small and medium enterprises, also remains an important issue, as does the persistent challenge of housing supply and affordability. An emerging thread across a several topics was the role of artificial intelligence and the impacts it may have on businesses and the Australian economy more broadly. These issues will continue to shape the RBA’s work and the committee’s future oversight.

The committee looks forward to continuing its scrutiny of the RBA’s work throughout this parliamentary term, and to ensuring that its decisions remain transparent, accountable and in the long‑term interests of the Australian community.

The Hon Ed Husic MPChair