Transcript
Philip Lowe, Governor (2016 – Present)
The Parliament of Australia has given the Reserve Bank some incredibly important responsibilities. The one the
community's most familiar with is that the first Tuesday of every month except for January, the Reserve Bank Board
meets to set the cash rate. The cash rate's very important because it influences the cost of people's mortgages, the
rate of return they get on their savings. It influences the exchange rate and the value of people's assets. So the
community has a lot of interest in those decisions.
The Reserve Bank also produces and distributes Australia's banknotes. We have some of the best quality banknotes in
the
world. We've got fantastic technology. We were the first country to introduce the polymer banknotes. We were also
one of
the first countries to have a man and a woman on every single banknote which I'm particularly proud of. The
banknotes
are produced in a purpose built facility down on the outer suburbs of Melbourne. We've got a huge vault there which
we
store and distribute banknotes from. It might come as a surprise to many people that despite the use of, increase in
use of electronic payments, the value of bank notes on issue is at a record high. So many people are holding our
banknotes as a store of value.
The Reserve Bank is also the banker for the Australian Government. So when you get a Medicare refund or if you're
lucky
enough to get a tax refund. Or when you have to pay your tax, those transactions occur through the government's bank
accounts at the Reserve Bank. So, we manage all the government's payments whether it's for defence purposes or
social
security. So we're a very large transactional banker in our own right.
The Reserve Bank also operates the core of Australia's payment system. When money goes from one bank to another,
perhaps
because you are paying a bill to somebody who banks with a different bank. The money finds its way from your bank to
the other bank through the Reserve Bank. So, it's a really central part of Australia's payment system.
The Reserve Bank has also developed with the banks, the New Payments Platform. Which allows people to make payments
24
hours a day, 7 days a week using just a mobile phone number or an email address. So, you don't need to know a BSB or
account number anymore. The Reserve Bank encouraged the financial institutions to develop this new system and
then we built a core part of the infrastructure that allows the money to move from one bank to another.
The Reserve Bank is also responsible for the stability of the financial system. We do this in a number of ways.
We operate in the financial markets every day to keep the liquidity of the system stable. In extremes we can operate
as the lender-of-last-resort providing liquidity of solvent but troubled institutions. We also work with the other
regulators APRA and ASIC, through the Council of Financial Regulators to identify risks in the financial system. And
develop plans when we see the risks developing. And we put out public analysis and research on financial stability
issues on a regular basis.
The Reserve Bank also manages Australia's foreign exchange reserves, which is very important. We represent Australia
in many international forums, the G20, the Bank for International Settlements, and the International Monetary Fund.
We're bringing Australia's particular perspective to international audiences. Which in many cases is very important
and it's often highly valued. We do all this with 1,300 people. Most of us are located here in the head office in
Sydney.
But we have offices in Brisbane, in Melbourne, in Adelaide, in Perth. And we also have offices in Beijing, London
and New York.