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Speaker 1: Major overhaul has been announced for the Reserve Bank and

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Speaker 1: to tell us exactly what it all means. Michelle Maynard

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Speaker 1: from the Carbon Group. Hello, Michelle, Michelle right, coming to

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Speaker 1: our rescue to explain to us. This is an interesting

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Speaker 1: way Clayman's terms. What exactly is the overhaul?

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Speaker 2: Yeah, so basically the Reserve Bank, we all know it's

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Speaker 2: our friend, we love them. Every month they meet and

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Speaker 2: they set the monetary policy, which basically for most everyday

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Speaker 2: people is interest rates. That's what they do. But we

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Speaker 2: know over the past twelve months they haven't really done

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Speaker 2: what they said they were going to do, which was

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Speaker 2: not touched interest rates until twenty twenty four. So what

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Speaker 2: they're doing is they're splitting out a separate monetary policy board,

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Speaker 2: which means that we only eight people who are going

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Speaker 2: to be setting interest rates and what the government does

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Speaker 2: in terms of monetary policy, and they're going to be

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Speaker 2: changing how they do that. So the hope is not

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Speaker 2: that it's going to bring interest rates down, because that

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Speaker 2: might not be the effect, but it means that we're

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Speaker 2: going to be able to understand what they do better.

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Speaker 3: Is this a real kick in the teeth of Philip

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Speaker 3: Lohan's team, you know, because it's not a vote of

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Speaker 3: confidence in them, is it.

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Speaker 2: Well, if somebody else was brought in to do your job,

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Speaker 2: you probably didn't think you were doing it that well.

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Speaker 2: And that's basically what this is about. Is he said

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Speaker 2: interest rates weren't going to go up into a twenty

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Speaker 2: twenty four, and we've had ten in a row. And

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Speaker 2: so with this new board, they're only going to meet

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Speaker 2: eight times a year, so once every six weeks. So

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Speaker 2: we're going to have to set our clocks a little

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Speaker 2: bit differently to when we watch for that announcement. But

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Speaker 2: rather than being a one page press release after this

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Speaker 2: meeting to say why they've made a decision, the board

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Speaker 2: is actually going to have to front a media conference

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Speaker 2: and answer questions and also disclose who voted for the

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Speaker 2: interest rate rise and who didn't. So it's going to

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Speaker 2: be really interesting because we're going to be able to

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Speaker 2: rather just lump blame on one person, good old Fiel,

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Speaker 2: We're going to see everybody there and understand what I understand,

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Speaker 2: the reasons why they're making the decisions they're making.

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Speaker 1: Rather than just telling us decisions being made. I guess

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Speaker 1: most people with the Mortgage's question is what does this

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Speaker 1: just essentially mean for me?

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Speaker 2: What I'm really happy about with is and it doesn't

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Speaker 2: come into effect until twenty twenty four, so we've got

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Speaker 2: some time. Yesterday I got another letter from my bank

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Speaker 2: to say that my interest rate was going up again,

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Speaker 2: and the last time the Reserve Bank made that decision

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Speaker 2: was two months ago. So by getting this at once

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Speaker 2: every six weeks, not once every four, it's going to

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Speaker 2: do two things. One's going to allow the economy to

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Speaker 2: feel the effects of that a little bit more so

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Speaker 2: we're going to be able to understand. But also for

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Speaker 2: mortgage told us, it's going to allow us to feel

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Speaker 2: the effects and get prepared and not get these letters

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Speaker 2: months after the decision because the banks are trying to

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Speaker 2: play catch up.

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Speaker 1: Yeah, I found that I'm getting I'm getting the letter

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Speaker 1: before the other one that went you know that changed

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Speaker 1: last time has even gone into effects.

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Speaker 3: They've changed.

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Speaker 1: Your mouth's coming out getting a letter saying there's more

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Speaker 1: and I'm totally confused.

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Speaker 2: I mean, it's selling the letters. I'm sure that would

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Speaker 2: take millions out of the economy in terms of posting anyway,

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Speaker 2: So that you know, I know that really a great idea.

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Speaker 3: I'm a little bit baffled. Boy, there's one now with

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Speaker 3: Elbow and Jim Charmers. And why didn't this happen with

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Speaker 3: Hawk competing in eighty nine when the interest rates are

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Speaker 3: over seven night percent? What's changed?

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Speaker 2: Well, Clery, I was four in nineteen eighty nine. I'm

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Speaker 2: tali is sure what happened back then? Mate, we didn't get.

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Speaker 1: I'm doing.

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Speaker 2: But I think I think it's a long long time coming.

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Speaker 2: Definitely a long time coming, and it's got bipartisan support

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Speaker 2: to which is what I love is that the government

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Speaker 2: is looking at these not from a political perspect there,

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Speaker 2: but both sides are getting on board to make these

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Speaker 2: changes in printable. Once obviously the legislation goes to government,

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Speaker 2: we'll see what they fight out over then after that, Yeah.

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Speaker 3: Gotcha, Michelle.

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Speaker 1: All this aside, where do you think interest rates will

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Speaker 1: go for the rest of the year.

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Speaker 2: Well, interestingly, a couple of the majors have quietly, quietly

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Speaker 2: dropped their long term fixed interest rates, and what that

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Speaker 2: normally means is they think interest rates are going to

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Speaker 2: be coming down. So look, I think there may be one,

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Speaker 2: possibly two more upwards rate rises for this year, depending

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Speaker 2: on how inflation goes and then by the end of

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Speaker 2: the year we should hopefully start seeing them come back

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Speaker 2: be on again.

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Speaker 1: Right, all right, Michelle, Two board meetings, all right, fantastic,

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Speaker 1: Always lovely to talk to you and get a little

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Speaker 1: splaining Michelle's plaining.

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Speaker 3: Have a great, great date, and my favorite line on

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Speaker 3: the show this week clazy always four and sorry guys.

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Speaker 2: Great