Beat ups and bust ups
The government is not at war with the Reserve Bank. Not yet, anyway.
There is a perception held by political types that Treasurer Jim Chalmers is one of the most effective communicators within the federal government. One economist reflected to us recently that every word he speaks is “carefully selected” and “never a mistake”.
So while it’s easy to blame the media for leaping to conclusions when trying to read between the lines of government statements and media releases, when it comes to Chalmers there’s good reason for taking seriously any subtle shifts in his turn of phrase.
This makes the commentary his office distributed on Sunday evening all the more curious. Previously, any statements he made before the release of GDP figures focused on the government’s approach to the economy amid soft conditions. But this time that shifted to directly describing the impact of the Reserve Bank’s higher rates, and global volatility, as “smashing the economy”.
Parts of the media interpreted this as anywhere from a sledge at the central bank to all-out war. This was compounded by Assistant Immigration Minister Matt Thistlewaite saying on Monday that the government didn’t want to see the RBA “go too far”.
