Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Hansard source

I'm pleased: not only do we have the great senator from New South Wales reading the talking points of the Prime Minister's office, we have Senator Gallagher reading what I say in the Australian Financial Review. That is really good.

In relation to the official cash rate, what I said in the interview that was quoted—and I stand by that—is that decisions on monetary policy are entirely a matter for the Reserve Bank, to make assessments independently as they consider is appropriate. You've obviously got to consider the international context, and that is obviously part of the judgement the Reserve Bank has made, if you listen to what the Reserve Bank has said in recent times. The Reserve Bank governor has actually said exactly this: you've got to consider what is happening in a structural sense to global interest rate settings.

If the interest rate, the official cash rate, in Australia was materially higher than in other parts of the world—as it turned out under Labor, when you put in massive fiscal stimulus—then the value of our currency would go up and our exporting businesses would be less competitive internationally. It would hurt our agricultural sector. It would hurt our resources sector. It would hurt our manufacturing sector. So the Reserve Bank makes these judgements, independently as they see fit, and I have indeed welcomed the decisions the Reserve Bank has made. Indeed, monetary policy and fiscal policy are working in the same direction, helping to ensure that our economy can continue to strengthen into the future in the context of very difficult global economic conditions.