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The New Daily
The New Daily
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Michael Pascoe

EXPLAINED: Michael pascoe interest rates won t work like they used to - The Real Truth

When a supply shock increases inflation too much, lifting interest rates can just make it worse, writes Michael Pascoe. Photo: TND

The Reserve Bank – and those of us who watch the bank for a living – tend to enjoy a good graph. Governor Philip Lowe flashed a couple of rippers on Tuesday night.

They were illustrations along the way to a bigger story about how inflation is going to be a wilder ride in the years ahead, with the implication that raising and cutting interest rates won’t be much of a tool for taming it.

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