The last time a bank outsider was made governor was in 1989 when then-Treasury secretary Bernie Fraser was appointed.
Australia Institute executive director Richard Denniss said he hoped the appointed governor would be an outsider who would be able to creatively tackle inflation.
“Wilkinson or Kennedy,as people coming from outside the RBA,have the potential to help it adapt to new challenges that it’s been struggling with,” Denniss said.
Jenny Wilkinson
Wilkinson,who was made Finance Department secretary last year,is also in the running. She has held senior positions across several departments and agencies,including the Treasury and the Parliamentary Budget Office. She began her career at the RBA.
AMP chief economist Shane Oliver said Wilkinson was widely seen as the strongest candidate because of her broad range of experience and because she appeared to be in the treasurer’s good books.
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“She may appear in some commentators’ views as a favourite because the treasurer has spoken favourably of his dealing with her when they were in opposition,” Oliver said.
Michele Bullock
The Reserve Bank’s first female deputy governor,Bullock has held the role since her appointment last year and has been at the bank since 1985. As deputy governor,she is second-in-command after Lowe and is considered a strong contender for the top job.
It’s a well-trodden path,with Lowe and his two predecessors – Glenn Stevens and Ian Macfarlane – all serving as deputy before being promoted to governor.
GSFM advisor Stephen Miller said Bullock would be an outstanding candidate because of her balanced abilities.
“She’s a very fine applied economist who has achieved a lot in the academic world,and she communicates quite well as well,whereas I think Lowe has had his difficulties,” Miller said.
Outside chances
While it’s unlikely that Lowe will be re-appointed,Oliver said there was an argument for his term to be extended,and that any new governor would face the same challenge as the current governor.
“From an economic point of view,Lowe should have his term extended because we’re halfway through a battle to curb inflation,” Oliver said.
Then-RBA governor Bernie Fraser (right),with Ian Macfarlane,the man who would replace him in 1996.Credit:Andrew Meares
“But the common speculation is that Lowe will be replaced. The main challenge will be for the governor to make sure that inflation continues to fall,but also to avoid a recession.”
Former RBA deputy governor Guy Debelle and Australian Bureau of Statistics head David Gruen have also been mentioned as potential candidates for the job.
With Shane Wright