The ranks of the Reserve Bank are set to be bolstered following the appointment of a top official from UK’s central bank.
Following a 31-year stint at the Bank of England, Andrew Hauser, who has most recently led the markets division, will join the RBA as deputy governor.
In his role at the BOE, Mr Hauser managed the central bank’s balance sheet and the UK’s official foreign exchange reserves.
Announcing the appointment, Treasurer Jim Chalmers said Mr Hauser’s distinguished career at the BOE would ensure Australia has the most effective central bank to meet our current and future economic challenges.
“His appointment strikes the right balance between providing deep central banking experience and offering a fresh, global perspective to the work of the RBA,” Dr Chalmers said.
Mr Hauser will fill the vacancy left by Michele Bullock when she was elevated to become the nation’s top central banker in September.
The ninth person to hold the role, Ms Bullock, was appointed for a seven-year term replacing Phil Lowe, and is the RBA’s first female governor.
Like Australia, the United Kingdom has experienced aggressive monetary tightening in the last year with the Bank of England battling to tame persistent price pressures.
In response to inflation, the BOE has hiked rates 14 times since December 2021 to a 15-year high of 4.25 per cent.
Monetary tightening in Australia has not been quite as aggressive, with the RBA not moving until six months later, but hiking rates 13 times to their current rate of 4.35 per cent.
Unlike Australia, inflation in Britain has fallen far quicker, with the annual inflation rate dropping from 11.1 per cent in October 2022 to 4.6 per cent a year later.
Money markets in the UK are now pricing in rate cuts from June 2024.
However, in Australia, inflation is still running at 5.4 per cent, down from a peak of 7.8 per cent, with money markets still forecasting a 50 per cent chance of a rate hike in February before cuts commence in late 2024.
The RBA has a number of other senior positions to fill including the roles of assistant governor in the economics division, vacant since the resignation of now-Westpac chief economist Luci Ellis, and chief operating officer, a role recommend by the recent review of the central bank.