Michele Bullock, Governor of the Reserve Bank of Australia: The Record, 2023–2026
Interest Rates (21210) +0.9807σ Q2 2026 · position 96.6, ranked against 30 quarters
Inflation (21220) +2.1049σ Q2 2026 · position 100.0, ranked against 22 quarters
Employment & GDP (21230) +0.5947σ Q2 2026
The Office and the Governor
Michele Bullock became Governor of the Reserve Bank of Australia on 18 September 2023, for a seven-year term ending in September 2030. Her appointment was announced on 14 July 2023. She joined the Bank in 1985 and served as Assistant Governor for currency, business services and the financial system before becoming Deputy Governor in April 2022. She holds an economics degree with honours from the University of New England and a master’s degree from the London School of Economics. She is the first woman to hold the office, as she noted in April 2025.
Her term has coincided with the largest changes to the Bank’s governance in decades. A media conference now follows every decision, the first on 6 February 2024. From April 2025, rate decisions have been made by a new Monetary Policy Board, and from July 2025 its votes have been published in unattributed form. The period has also asked more of the Bank than most: inflation that eased and then returned, a cycle of rate reductions reversed within a year, and an oil price shock from the conflict in the Middle East.
The Record in Decisions
Across 25 decisions to 29 September 2026, the Board held the cash rate 17 times, raised it five times and reduced it three times. The target was 4.10% when she took office. It rose to 4.35% in November 2023 and was held there for 15 months. Three reductions in 2025 took it to 3.60%, and three increases in February, March and May 2026 returned it to 4.35%. On 29 September 2026 a fourth increase of the year took it to 4.60%, the highest level since 2011.
Cash Rate Target, 18 September 2023 to 30 September 2026
APN chart based on Reserve Bank of Australia data: cash rate target, by effective date. Twenty-five decisions: 17 holds, five increases (slate markers) and three reductions (open gold markers).
Two features of the record stand out. The first is the long hold at 4.35% through 2024, which kept the cash rate below the peaks reached by most comparable central banks, and was part of what she called the narrow path: bringing inflation down without a large rise in unemployment. The second is the reversal of 2025–26. The Monetary Policy Board has divided three times: 6–3 to hold in July 2025, 5–4 to raise in March 2026 and 8–1 to raise in May 2026. The increase of September 2026 was unanimous; the Governor said afterwards that the Board had considered holding or raising by 25 basis points.
What Was Said, and What Followed
The Governor has generally declined to give forward guidance, and has said so: “I’m not going to give you forward guidance.” (29 September 2026). Where she did describe the outlook, the record allows her statements to be set against what followed. The ledger below records the principal ones.
| Date | Statement | What followed | Status |
|---|---|---|---|
| 6 Feb 2024 | Inflation back in the 2–3% band in 2025 and at the midpoint in 2026 (media conference) | Underlying inflation entered the band in the March quarter of 2025 (2.9%). It was 3.6% in the June quarter of 2026. | Held in part |
| 6 Aug 2024 | “a near-term reduction in the cash rate doesn’t align with the Board’s current thinking”, defined as the next six months (media conference) | The first reduction came on 18 February 2025, about six and a half months later. | Held |
| 18 Feb 2025 | “today’s decision does not imply that further rate cuts along the lines suggested by the market are coming.” (media conference) | Two further reductions followed in 2025, fewer than markets then expected, and were reversed in 2026. | Held |
| 8 Jul 2025 | The hold was a matter of timing rather than direction (media conference) | A reduction followed on 12 August 2025. | Held |
| 12 Aug 2025 | Forecasts: underlying inflation sustainably at the midpoint, on a cash rate falling to about 3.1% by mid-2026 (Statement on Monetary Policy) | Underlying inflation was 3.6% in the June quarter of 2026 and the cash rate 4.35%. On 3 February 2026 the Governor said the August 2025 forecast had “turned out not to be right”. | Not met |
| 4 Nov 2025 | Asked whether Australia risked stagflation: “No, I don’t think so.” (media conference) | By May 2026 the Bank forecast headline inflation near 4.8% and growth of about 1.3%, after the oil price shock. The June quarter outcome was 3.9%. The Governor has rejected the term for current conditions: before a Senate committee in June 2026, and on 29 September 2026, when she said “I wouldn’t call inflation of 3.5 per cent and an unemployment rate of 4.6 per cent stagflation.” | Held in part |
| 9 Dec 2025 | “I don’t think there are interest rate cuts in the horizon for the foreseeable future.” (media conference) | The cash rate was raised on 3 February 2026. | Held |
| 9 Dec 2025 | Of the Bank’s forecasting: “In the last year or so we’ve pretty much got it more or less right.” | On 3 February 2026 she said the August 2025 forecast had “turned out not to be right”. | Revised by the Governor |
| 11 Aug 2026 | Inflation back around the midpoint by the end of 2027 (media conference) | The August 2026 Statement on Monetary Policy puts the midpoint in 2028; the Board’s wording is “around the midpoint”. | Open |
| 11 Aug 2026 | “I think personally that it’s quite possible we might need to go”, on a further increase (media conference) | The Board raised the cash rate by 25 basis points to 4.60% on 29 September 2026, unanimously. | Held |
| 29 Sep 2026 | Asked whether a recession was now more likely: “That is not our central base case at this moment.” (media conference) | National accounts for the September quarter are published in December 2026. | Open |
| 29 Sep 2026 | “what I do know is that we’re not going back down to interest rates of zero or very close to zero”, while saying she did not know whether the current level was “the new normal” (media conference) | A statement about the longer run; it cannot yet be tested. | Open |
The Bank’s forecasts, published four times a year, can be tested the same way. Over the forecasts that have now resolved, unemployment was the most accurate, missing by 0.16 percentage points on average one year ahead. Underlying inflation missed by about half a point one year ahead. The largest misses were in the forecasts behind the 2025 reductions: those published in May and August 2025 put underlying inflation at 2.6% for the June quarter of 2026, a full point below the outcome.
Forecasts of Underlying Inflation for the June Quarter 2026, by Statement on Monetary Policy
APN chart based on Reserve Bank of Australia and Australian Bureau of Statistics data: Statements on Monetary Policy, February 2024 to May 2026, forecast tables, trimmed mean inflation, year-ended; outcome from the Consumer Price Index, June quarter 2026. Gold bars: the forecast published in that month’s Statement; slate dashed line: the June quarter 2026 outcome, 3.6%.
The Governor has described several figures for the rise in the price level, and they can be checked against the ABS Consumer Price Index. Her December 2024 figure of 16% over three years holds (16.2%), as does her February 2026 figure of 20 to 25% “over the last few years”, over four to six years. Two figures fit a longer period than the one stated: 18% “over the last couple of years” in February 2025 matches about four years, and grocery prices up 20% over two years in February 2024 compares with a rise of about 14% in the ABS food group. Her underlying point, that the price level has risen a long way and will not fall back, is borne out.
Positions Held Throughout
Independence. When the Treasurer said in September 2024 that interest rates were smashing the economy, a remark he later said was not a criticism of the Bank, the Governor declined to respond in kind. Asked about a former Treasurer’s criticism, she said: “I will stay out of the politics of it, John.” (24 September 2024). Before parliamentary committees she has said repeatedly that the Bank takes fiscal policy as given and that it is not her role to tell elected governments how to spend. Asked in September 2026 whether the Treasurer was shifting the blame for inflation, she said: “Look, I’m not here to play a blame game.” (29 September 2026).
The limits of one instrument. She has consistently described the cash rate as a blunt tool that cannot target particular groups or regions, and has acknowledged the cost it imposes. Asked in September 2026 whether the Bank was exploring other tools, she described the cash rate as “the only tool I can think of that we’ve got for this particular purpose” (29 September 2026).
“But I’ve only got one lever, and I have to get inflation down”
Michele Bullock, Senate Economics Legislation Committee, 5 June 2024 (Hansard)
Candour about the Bank’s past. In February 2025 she told the House Economics Committee: “Arguably, we were late raising interest rates on the way up.” (Hansard, 21 February 2025). In the same hearing she accepted the finding of the Bank’s independent review that it had been “a bit too insular”.
Housing and Households
On housing, her position has not moved in three years: prices reflect a long-standing shortfall of supply, which monetary policy cannot fix. In May 2025 she said “There’s nothing the Reserve Bank can do about these affordability issues of housing” (media conference). In September 2025, asked about government supply measures, she said: “I’m not confident it’s going to make any impact in the next two years.” (media conference). She has acknowledged that monetary policy works partly through housing, and in August 2026 noted that prices had risen about 50% since 2020.
On who carries the cost of higher rates, she has drawn a distinction that is often overlooked. Mortgage holders bear the direct cost of rate increases; inflation itself falls hardest on lower-income households who rent.
“Mortgagees have been badly affected by the increase in interest rates, but the group that has been probably worse-affected are the lower-income people who are renting.”
Asked in September 2026 whether households with mortgages were carrying the burden, she set out the other channels through which rates work: saving rather than spending, asset prices including housing, and the exchange rate, which the Bank’s research finds the most important. “I understand why the people who are impacted by this very directly in terms of loans feel that they are carrying the burden,” she said, “but actually, the interest rate increase gets into all sorts of cracks.” In aggregate, she said, measures of debt and mortgage stress were not “suggesting that there’s any massive stress in the household sector as a whole”, while acknowledging that individual households are under pressure (media conference).
The housing downturn of 2026 has tested the Bank’s reading of the sector. In June 2026 she attributed the easing partly to monetary policy and partly to the Budget’s tax changes and buyer uncertainty. In August she said the downturn had been larger than expected but was not a reason to reduce rates. In September she said part of the downturn was related to interest rates, and that falling prices, with the cost of materials rising, could make building uneconomic for developers, particularly at high density: “It’s possible the housing downturn may make that worse.” Describing herself as no expert on the national housing targets, she added: “My understanding is that we’re not really meeting the targets” (media conference). APN’s Residual Land Value (RLV) Gap™ (24410), which measures the margin left for land after construction costs, reached the lowest of its 60 quarters in the June quarter of 2026.
Under Scrutiny
The reversal of 2025–26. The three reductions of 2025 and the four increases of 2026 have drawn the sharpest questions of her term. Asked before a Senate committee in June 2026 whether the reductions were a mistake, she accepted that the economy’s supply capacity had been less than the Bank thought, but said: “So, no, I don’t accept we made a mistake.” and “Circumstances changed, and when circumstances change, we have to change.” (Hansard, 4 June 2026).
Government spending. Opposition members have pressed her repeatedly to attribute inflation to public spending. She has accepted that public demand adds to demand like any other, describing it in February 2026 as a matter of fact rather than judgement, while declining to single it out: in her words to the House committee the same month, it is not the sole cause but contributes, as private demand does (Hansard, 6 February 2026). She held the same line in September 2026: public and private demand “are both adding to aggregate demand”, and “I’m not here to blame the AI boom or public demand or consumers for what we’re observing.” (media conference).
Exchanges with senators. When a senator accused her in February 2026 of gaslighting over her description of the economy, she replied: “Senator, I take exception to that comment.” (Hansard, 12 February 2026). She later clarified that describing the economy as “okay” was not a claim that it was strong.
The payments outage. A failure of the Bank’s systems on 27 January 2026 disrupted payroll, welfare payments and property settlements. She apologised in her opening statement to the House committee and said of it: “It is not acceptable, and we do have to lift our game” (Hansard, 6 February 2026).
Unemployment. In March 2026 she said unemployment would probably have to rise, and in September 2026 that a rate between 4.5 and 5% would take enough heat out of the labour market. She has said neither is a target. Unemployment was 4.5% when she appeared before the House committee on 18 September 2026; the August figure, released on 24 September, was 4.6%. Asked after the September decision whether job losses were a necessary cost, she said that a rising unemployment rate need not mean job losses, and more often means that the number of jobs grows more slowly than the labour force: “Job losses, I don’t like the idea of job losses. We’ll do what we have to do to get inflation down because we need to.” (media conference).
Reception
Praise has centred on three things. The first is her composure under political pressure in 2024, defended at the time by economists including Saul Eslake. The second is the new transparency of the post-meeting media conferences; former Board member Bob Gregory said in 2024 that she was doing fine. The third is the narrow path itself: inflation back in the target band in 2025 while unemployment stayed between 4.0% and 4.4%. Global Finance graded her B+ for 2025.
Criticism has come from both directions. Some, including former Governor Bernie Fraser and the ACTU, argued that the reductions of 2025 came too late and were too small. Others, including economist Warren Hogan in February 2025, argued that the Bank’s own forecasts did not support reducing rates at all, a view the 2026 increases lent weight to. Her communication has been criticised as both too expansive and, between meetings, too sparse. The 2026 increases were opposed by the Greens and by the Australia Institute as costly in the face of a supply shock.
On the Record
Several statements widely attributed to the Governor do not appear in the primary record in the form reported.
| As reported | The primary record |
|---|---|
| “We’ve not run that scenario” (on modelling a cut to government spending), reported as the Governor’s | Those words were spoken by Assistant Governor Dr Sarah Hunter, who added that the Bank does not have the “manpower” to run every scenario. The Governor’s own words were “We haven’t done that scenario, let’s put it that way”, and she added that the Treasury is well placed to do such work. No witness said the Bank lacked the “resources”. (Hansard, 18 September 2026, proof transcript.) |
| “I don’t recall trying that scenario recently” | Not in the Hansard of the hearing. |
| “inflation has been slayed” | A reporter’s description of May 2025, not the Governor’s words. |
| A “sensible level” for interest rates (September 2026) | Deputy Governor Andrew Hauser’s words, not the Governor’s. |
APN Analytical Synthesis
The record of the first three years is one of a Governor who held a clear line on the Bank’s independence and on the limits of its instrument, who delivered a return of inflation to the target band in 2025 without the rise in unemployment many expected, and who then saw that result undone by the reductions of 2025, a stronger economy than forecast and an external oil shock. The strongest part of the record is the labour market; the weakest is the set of 2025 forecasts on which the reductions rested, which she has acknowledged. Her statements about the outlook have more often held than not; her statements about the Bank’s own forecasting accuracy have been revised by events.
The record is open. The Board raised the cash rate to 4.60% on 29 September 2026, citing higher energy prices and inflation outcomes stronger than expected. The August monthly figures, released the next day, put underlying (trimmed mean) inflation at 3.6%, unchanged, and headline inflation at 4.0%. The September figures follow on 28 October. This record is updated after each decision and each parliamentary appearance. It speaks only to what the published record can independently support, and does not constitute a view on future interest rates, inflation or the economy.
Sources
The Governor’s speeches, opening statements and post-decision media conference transcripts are published at rba.gov.au; parliamentary exchanges are from the official Hansard and, for the hearing of 18 September 2026, the proof Hansard. Figures are drawn from the following:
- Australian Bureau of Statistics (Reference period: June 2026) Consumer Price Index, Australia [https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/jun-2026], accessed 26 September 2026.
- Australian Bureau of Statistics (Reference period: August 2026) Consumer Price Index, Australia [https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/consumer-price-index-australia/aug-2026], accessed 1 October 2026.
- Australian Bureau of Statistics, Consumer Price Index, Australia, quarterly series: all groups, trimmed mean, and food and non-alcoholic beverages, year-ended [data set], ABS Data API, dataflows CPI and CPI_Q [https://data.api.abs.gov.au/rest/dataflow/ABS/CPI], accessed 26 September 2026.
- Australian Bureau of Statistics (Reference period: August 2026) Labour Force, Australia [https://www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia/aug-2026], accessed 1 October 2026.
- Parliament of Australia, House of Representatives Standing Committee on Economics, Hansard, 21 February 2025 [https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;db=COMMITTEES;id=committees%2Fcommrep%2F28670%2F0001;query=Id%3A%22committees%2Fcommrep%2F28670%2F0000%22], 6 February 2026 [https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;db=COMMITTEES;id=committees%2Fcommrep%2F29126%2F0001;query=Id%3A%22committees%2Fcommrep%2F29126%2F0000%22] and 18 September 2026, proof [https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;db=COMMITTEES;id=committees%2Fcommrep%2F29882%2F0001;query=Id%3A%22committees%2Fcommrep%2F29882%2F0000%22], accessed 26 September 2026.
- Parliament of Australia, Senate Economics Legislation Committee, Estimates, Hansard, 5 June 2024 [https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;db=COMMITTEES;id=committees%2Festimate%2F28114%2F0002;query=Id%3A%22committees%2Festimate%2F28114%2F0000%22], 12 February 2026 [https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;db=COMMITTEES;id=committees%2Festimate%2F29373%2F0002;query=Id%3A%22committees%2Festimate%2F29373%2F0000%22] and 4 June 2026 [https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;db=COMMITTEES;id=committees%2Festimate%2F29624%2F0003;query=Id%3A%22committees%2Festimate%2F29624%2F0000%22], accessed 26 September 2026.
- Reserve Bank of Australia, Cash Rate Target [https://www.rba.gov.au/statistics/cash-rate/], accessed 29 September 2026.
- Reserve Bank of Australia, Media Conference: Monetary Policy Decision, transcripts, 6 February 2024 to 29 September 2026 [https://www.rba.gov.au/speeches/], accessed 26 September 2026; 29 September 2026 accessed 1 October 2026.
- Reserve Bank of Australia, Statement by the Monetary Policy Board: Monetary Policy Decision, 29 September 2026 [https://www.rba.gov.au/media-releases/2026/mr-26-27.html], accessed 29 September 2026.
- Reserve Bank of Australia, Statement on Monetary Policy, February 2024 to August 2026, forecast tables [https://www.rba.gov.au/publications/smp/], accessed 26 September 2026.
Australian Bureau of Statistics and Reserve Bank of Australia material is used under a Creative Commons Attribution 4.0 International licence. Calculations are APN’s and are not attributable to the Australian Bureau of Statistics or the Reserve Bank of Australia.
Reception is drawn from ABC News, AAP, Bloomberg, Yahoo Finance, Global Finance and the AICD.
Disclaimer
The analysis and information contained in this publication are for general informational and strategic purposes only and do not constitute financial, investment, legal, or any other form of professional advice. Australian Property Network is not a licensed financial advisor. Property values and market conditions can go up or down. Before making any property or investment decisions, you must conduct your own thorough research and seek independent professional advice tailored to your specific circumstances.
