As such, it is in our view fully consistent with, and gives practical expression to, the objectives given to the Bank in legislation: the stability of the currency (that is, its purchasing power); full employment; and the economic prosperity and welfare of the people of Australia. It has bi-partisan support in the Parliament.
It has also been, in practice, over the 15 years we have been using it, the most effective framework for monetary policy Australia has had so far. The target is expressed in terms of the Consumer Price Index (CPI). This is, of course, only one of a number of price indexes.