Michele Bullock, Australia's first female central bank chief, officially took the reins on Monday, stepping into a position marred by criticism over rising living expenses during her predecessor's tenure.
Bullock was appointed as the governor of the Reserve Bank of Australia (RBA) in July, succeeding Philip Lowe, who concluded an unusually unextended seven-year term before stepping down. In recent months, Lowe faced mounting pressure to resign, with the public accusing him of misleading them about anticipated increases in borrowing costs.
Bullock assumes leadership of the bank at a critical juncture, with demands for an overhaul of its hierarchical culture following a government review and the imperative to curb inflation.
Shane Oliver, Head of Investment Strategy and Chief Economist at AMP, an Australian financial services provider, expressed optimism about her appointment, particularly in light of the RBA's successful handling of issues like unemployment.
"There had been a lot of debate in the run-up to the change that maybe [an] outsider would be appointed, but I don’t think that would’ve been justified," he commented to CNN.
Bullock has been with the bank since 1985, joining full-time shortly after graduating from university.
Her ascension to the top role was not originally anticipated.
According to Oliver, Lowe, who, like Bullock, had spent decades at the bank, was expected to serve another term until he was derailed by a cost of living crisis.
In 2021, the former central bank chief stated that the cash rate, a primary interest rate influencing others in the country, might not see an increase until 2024, based on economic conditions at the time and RBA forecasts.
However, after Russia's invasion of Ukraine in February 2022, which led to a global surge in inflation, the central bank proceeded to raise rates a record 12 times from May 2022 to the present.
This move surprised many and ignited public outcry, particularly among Australians who took out loans or mortgages under the belief that borrowing costs would remain low.
The rate hikes posed challenges for households, with numerous consumers reporting difficulties in keeping up with expenses, prompting them to cut back on spending, as acknowledged by RBA officials in a February speech.