Reserve Bank of Australia (RBA) Governor Michele Bullock addressed the Chief Executive Women 40th Anniversary Melbourne Annual Dinner on Thursday, providing insights into the RBA’s current economic outlook and policy considerations.
**Navigating Global Economic Uncertainties**
Governor Bullock emphasized the complexities arising from tariff unpredictability, stating that it necessitates a measured approach to assess the potential impacts on both demand and supply. She cautioned that it is currently premature to definitively determine the future trajectory of interest rates, given these uncertainties.
**Dual Mandate and Economic Stability**
The RBA’s primary focus remains on its dual mandate of maintaining price stability and fostering full employment. Governor Bullock acknowledged the anticipated period of adjustment as various countries respond to evolving trade policies, particularly those initiated by the United States.
**Australian Financial System Resilience**
Despite global economic headwinds, Governor Bullock reassured that the Australian financial system is robust and well-positioned to withstand external shocks. She noted that the current situation does not appear to have the same degree of impact as previous market events, such as the 2008 financial crisis.
**Monitoring Domestic Economic Impacts**
The RBA is closely monitoring how global uncertainties are influencing the decisions of Australian households and businesses. This includes careful observation of financial market conditions and ongoing communication with other central banks to coordinate responses. The exchange rate and the reactions of Australia’s trading partners, as well as potential counter-responses from the US, are also being closely scrutinized.
**Market Reaction**
Following Governor Bullock’s comments, the AUD/USD pair experienced a recovery, trading around 0.6185, reflecting a 0.55% increase on the day.
**Australian Dollar Performance**
The Australian Dollar demonstrated varied performance against major currencies. It exhibited the strongest gains against the US Dollar. The following table summarizes the percentage change of the Australian Dollar (AUD) against listed major currencies:
| | USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF |
| :—- | :—— | :—— | :—— | :—— | :—— | :—— | :—— | :—— |
| **USD** | – | -1.06% | -0.29% | -1.27% | -0.09% | -0.49% | -0.81% | -1.70% |
| **EUR** | 1.06% | – | 0.53% | -0.23% | 0.95% | 0.54% | 0.20% | -0.69% |
| **GBP** | 0.29% | -0.53% | – | -0.75% | 0.41% | -0.01% | -0.34% | -1.34% |
| **JPY** | 1.27% | 0.23% | 0.75% | – | 1.19% | 0.77% | 0.40% | -0.34% |
| **CAD** | 0.09% | -0.95% | -0.41% | -1.19% | – | -0.41% | -0.73% | -1.73% |
| **AUD** | 0.49% | -0.54% | 0.00% | -0.77% | 0.41% | – | -0.32% | -1.33% |
| **NZD** | 0.81% | -0.20% | 0.34% | -0.40% | 0.73% | 0.32% | – | -0.99% |
| **CHF** | 1.70% | 0.69% | 1.34% | 0.34% | 1.73% | 1.33% | 0.99% | – |
*Note: The table shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Australian Dollar from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent AUD (base)/USD (quote).*
