The Reserve Bank's Decision to Squash Inflation

The Reserve Bank's job is to squash inflation without crunching the economy. The Treasurer knew full well that the Governor, after earlier criticism, now holds a news conference and gives a keynote address the day after interest rates were announced. People who are under pressure will find this decision hard to cut. Stephen Kacula says that in his view and in light of these results, he believes the Reserve Bank has interest rates one whole percentage point or 100 basis points higher than they should be.