The Treaty therefore establishes a clear hierarchy of objectives for the single monetary policy, with price stability unambiguously assigned overriding importance. The experience of the 1970s and 1980s not only demonstrated the importance of assigning central banks the clear objective of price stability. It also illustrated the advantages of central bank independence in the pursuit of this goal.
If Australia truly can have lower unemployment – sustainably – policy should be used to try to get there. As the Governor explained last week, that was one important consideration motivating the Board's recent decision to lower the cash rate. Thank you for your time.