RBA ‘unfairly targeted’
Harvey Norman boss defends Lowe’s decisions
BILLIONAIRE businessman Gerry Harvey has defended the Reserve Bank and its governor Philip Lowe, declaring the institution has been “unfairly targeted” by critics as it attempts to navigate one of the most challenging economic periods in history.
Mr Harvey said the global pandemic had “thrown all the rules out the window”, making economic policy decisions and predictions incredibly difficult, if not impossible.
Mr Harvey, who is chairman and co-founder of retail chain Harvey Norman, is one of only a few ASX-listed bosses to publicly defend the RBA and its nine months of interest rate hikes that have earned the ire of homeowners and some politicians.
After unveiling Harvey Norman’s interim results on Tuesday, Mr Harvey said that those who criticised the central bank should ease up and explain how they would have coped with the same threat of inflation and the pandemic that Governor Lowe had faced.
“I think that the RBA are being unfairly targeted.
“And I think that, it’s all right for people to throw stones, but I’d like to see them in the same position and have to make the same decisions,” Mr Harvey said.
“The thing is, all the economists in the Reserve Bank have been caught in a situation where it’s much more difficult to predict what will happen than has happened in the past because we’ve just had a pandemic that has thrown all the rules out the window.”
Mr Harvey’s comments come after Mr Lowe’s recent grilling before politicians in Canberra over his decisions to accelerate interest rate hikes to decades highs to combat inflation and the impact that is having on homeowners and the broader economy.
While the Albanese government and Treasurer Jim Chalmers have not publicly criticised the RBA and its handling of interest rate policy, they have not been huge public defenders either.
A current review of the RBA, whose findings are due in March, could see a restructure of the RBA’s operations, while the government may not renew Mr Lowe’s tenure when it expires in September.
Some politicians and advocates have attacked the RBA and called for the departure of Mr Lowe, as his interest rate tightening policy to press down on inflation squeezes household budgets and might engineer a recession.
But Mr Harvey, whose retail business is heavily dependent on discretionary spending, said the RBA was in an incredibly difficult position and doing the best it could.
“The RBA has made decisions in the past based on the past, and they can be fairly accurate sometimes.
“But where you’ve got no past, and you’ve only got future, how can you be accurate?
“And that being the case, you are going to make mistakes,” he said.
“When you look back, and you say ‘Oh, I wish I had my time again’. Well, what would have you done if you were them at that time?”