Steph Chalmers

We've got a new governor of the Reserve Bank.

It's a lot more, as you say, theatrical.

Yeah, so we had, as you say, a lot of focus on that issue of independence.

I think we had Elizabeth Warren, obviously a Democrat, the top Democrat on the panel talking about, are you going to be a sop puppet for the president?

And of course, Kevin Walsh pushing back on that.

I don't think anything he said, you know, was particularly unexpected or extraordinary.

It was a lot of sort of non-answers to these questions

He pushed back on the idea that he would lower interest rates as the president has requested and said, you know, that's not something that the Federal Reserve Chair will do.

So trying to keep that idea of independence of the central bank.

But then he also wasn't directly asked about whether he wanted lower interest rates and didn't.

confirm or deny that either.

So he was also asked about the issue you were saying that he may not be confirmed until the hearings around Jerome Powell are wrapped up and he wouldn't answer whether he would support Jerome Powell.

staying in place as the temporary Fed chair until he's then confirmed.

Yeah, I mean, I think this issue of the independence of the US Federal Reserve has really been one of the issues that has hurt Donald Trump in terms of having adverse market reactions, which obviously he doesn't really like either because it does threaten the credibility of the US central bank.

And again, also his ability to publicly criticise it.

If it's viewed that he's installed this guy and, you know, he's one of his sort of cronies, then

That kind of reduces the impact of him having a scapegoat, someone he can criticise and say, well, I want lower interest rates, it's not my fault.

So that kind of relationship between the government and the central bank, I think, in a way can give the government a potential scapegoat if the central bank is considered to be independent.

Thanks for having me.

This is an ABC podcast.