Australia central bank appoints first female head Michele Bullock for next seven years

Australia has made history by appointing its first female head of the central bank. Michele Bullock, the deputy of current Reserve Bank of Australia (RBA) Governor Philip Lowe, has been chosen to lead the RBA for the next seven years. The decision not to reappoint Lowe for a second term comes amidst public backlash over the sharp increase in interest rates.

Australian Treasurer Jim Chalmers and Prime Minister Anthony made the announcement, highlighting Bullock's qualifications and her ability to lead the RBA through an upcoming reorganization. Chalmers emphasised the significance of the appointment, stating that Bullock would be the first woman to ever lead the Reserve Bank in Australia.

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Lowe will leave office on September 17, marking the end of his 43-year career at the central bank. Lowe is due to accompany Chalmers to a Group of 20 meeting in India next week. "This is a history-making appointment, Michele Bullock will become the first woman to ever lead the Reserve Bank in this country," said Chalmers reported Reuters.

The government faced pressure to replace Lowe due to criticism over his encouragement of borrowing in 2021, assuring the public that interest rates would not rise until 2024. However, rates started increasing in mid-2022, and the central bank has since raised them 12 times to reach a decade-high of 4.1 percent. This has led to increased monthly mortgage repayments, exacerbating the cost of living crisis faced by households.

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"The Reserve Bank is in very good hands as it deals with the current inflation challenge and implementing the recommendations of the Review of the RBA," Lowe stated.

Bullock joined the RBA in 1985 with a masters from the London School of Economics and is highly respected by analysts. Financial markets reacted calmly to the change, and experts believe Bullock's appointment is preferable to a political appointee.

"It is a challenging time to be coming into this role, but I will be supported by a strong executive team and boards," Bullock stated.

The RBA is currently undergoing a major reorganization following an independent review of its operations. The review recommended significant changes to the formulation and communication of policy. 

(With inputs from Reuters)