Bloxo is back with a suggestion, via the AFR:
Having cut its cash rate to a record low of 1 per cent recently, the Reserve Bank of Australia (RBA) is rapidly running out of room to provide further support for growth…forcing the central bank to use unconventional policy tools, such as quantitative easing, at a time when the government is running budget surpluses, would be a truly strange policy mix.
After all, among the many lessons from Australia’s long boom has been that having an independent central bank, within the constraints of an agreed mandate (the 2-3 per cent inflation target), has been a key institutional framework that has helped to reduce the volatility of the economic cycle…policymakers could consider setting up an independent fiscal authority.
