Reserve Bank of Australia

The Reserve Bank is currently governed by the Reserve Bank Act 1959. In practice the Reserve Bank concentrates on the first objective, that is to control inflation through monetary policy. The current objective is a policy of inflation targeting aimed at maintaining the annual inflation rate at between "2–3 per cent, on average, over the cycle". This target was first set in 1993 by the then Reserve Bank Governor Bernie Fraser and was then formalised in 1996 by the then-Treasurer Peter Costello and incoming governor Ian McFarlane. The Reserve Bank gives banking and registry services to agencies of the government, to other central banks, and other official institutions. The assets of the bank include the gold and foreign exchange reserves of Australia, which is estimated to have a net worth of A$101 billion. Nearly 94% of the RBA's employees work at its headquarters and at the Business Resumption Site, both in Sydney. The remainder of the total of 926 staff work in Adelaide, Brisbane, Canberra, Melbourne, Perth, London and New York City. A wholly owned subsidiary of the bank is Note Printing Australia, which employs 257 other workers, and which manufactures the Australian dollar and other securities, for markets both in and outside of Australia. The Payments System Board fills the role of deciding on the bank's payments system policy and the Reserve Bank Board is responsible for all other monetary and banking policies of the bank. Conflicts between the two boards do not occur often, and when they do, they are resolved by the governor. ==Governors and their roles==

The Governor is the most senior official of the RBA. The position is appointed by the Treasurer for a term of up to seven years and may be renewed. The Governor chairs both the Reserve Bank Board and the Payments System Board and resolves any disputes between them. The RBA governor is required by the Reserve Bank Act 1959 to keep in contact with the Treasury on matters concerning both the Treasury and Reserve Bank and vice versa. It also mandates that the RBA board inform the government of the bank's monetary and banking policy, which is often accomplished through the governor's meetings with the Treasurer. Since 1996, the governor and other senior members of the RBA have appeared twice annually before the House of Representatives Standing Committee on Economics to explain the conduct of the bank. List of Governors was the only governor to have headed both the Commonwealth Bank and the Reserve Bank of Australia. The longest-serving governor, if his periods of service to both the Commonwealth Bank and the Reserve Bank of Australia are included, is H. C. Coombs, who served nineteen years and six months combined. This made Bullock the RBA's first female Governor. ==Reserve Bank Board==

building seen here in Canberra''). The Reserve Bank Board consists of nine members: three ex officio members - the Governor (Chair), the Deputy Governor (Deputy Chair), and the Secretary to the Treasury, and six external members appointed by the Treasurer. ==Payments System Board and Australian Competition & Consumer Commission==

The Reserve Bank Act 1959 authorises the Payments System Board to decide the Reserve Bank's payments system policy. This is done so it can control risk, promote efficiency and to aid in competitiveness and balance in the financial system. The bank's power through the Payment Systems Act 1998 allows it to regulate any payment system and can create binding rules for security and performance in the system. If members of a payment system are at odds over issues of market risk, admission, safety and rivalry, the RBA can additionally administer arbitration with the consent of those involved. The RBA is also permitted to gather information from a payment system or participants thereof. The bank can also regulate the competition of transactions since August 2001. Members of the Payments System Board are defined by Section 25A of the Reserve Bank Act 1959, with three of the members being ex officio or representatives of another organisation. The governor of the Reserve Bank of Australia is the Chair of the Payments System Board, there is one representative of the RBA, and there is one representative of the Australian Prudential Regulation Authority (APRA). In addition, there are up to five other members of the board who are appointed by the Treasurer for a term of up to five years. The board meet once per quarter, usually in Sydney with five members forming a quorum, which must be chaired by the Governor or, in their absence, the Deputy Chair. The Chair of the RBA meets with the Chair of the ACCC at least once annually on issues of interest to both parties in the payments system, in addition to members of both organisations consulting over issues that are mutually important. The current members of the Payments System Board are: ==History ==

From the middle of the 19th century into the 1890s, the prospects for the forming of a central bank grew. In 1911, the Commonwealth Bank was established, but did not have the authority to print notes, which function was still that of the Treasury. A movement toward re-establishing the gold standard occurred after World War I (1914–1918) with John Garvan leading various boards in contracting the money supply on the route to doing so, and the gold standard was instituted for both the British pound sterling and the Australian pound in 1925. Mid-19th century–1924 Andrew Fisher's government created a commercial bank owned by the government, but not a central bank. Proposals for a national bank in Australia were first raised in the mid-19th century, and got a significant boost in the 1890s as a result of the Australian banking crisis of 1893 during which many commercial banks and building societies collapsed, leading to a general economic depression. The Australian Labor Party, formed during this period, proposed a bank which would be a protected and cheap way of providing financial services. The party's platform for the 1908 election was for a "Commonwealth Bank", which would have both commercial and central bank functions. The Australian Notes Board (ANB) was created in 1920 and partially acceded to Miller's request, in having four directors, with the governor of the bank being an ex officio member. The Treasurer and Country Party Leader Earle Page wanted to end the monetary contraction which particularly hurt his farming constituents, who were as a result receiving reduced export prices. The monetary policy of the bank from 1931 until the early 1970s had been to maintain a stable exchange rate with the pound sterling. In January 2026, the central bank raised key interest rate for the first time in 2 years to 2.58% due to unexpectedly high inflation and unemployment hit a ⁠seven-month low in December. ==Securency scandal==

Since 2007, the RBA's reputation has been affected by the 'Securency' or Note Printing Australia scandal. These RBA subsidiaries were involved in bribing overseas officials so that Australia might win lucrative polymer note-printing contracts. Australian press coverage, which continued into late 2011, reflects concerns with the apparent laxity and tardiness of corrective actions undertaken by relevant RBA board members and officials. The matters were not reported to the Federal Police in 2007, although they have been since, while in 2011 it was revealed that the RBA had to correct inaccurate evidence previously given to parliamentary committees. Former senior executives were charged with foreign bribery offences under the Criminal Code Amendment (Bribery of Foreign Public Officials) Act 1999. In these proceedings, two of the executives were represented by William "Bill" Doogue. Ultimately, no one received a custodial sentence for these charges. In July 2014, WikiLeaks released a copy of a court order prohibiting publication throughout Australia of information that "reveals, implies, suggests or alleges" corruption involving specifically named past and present high-ranking Malaysian, Indonesian and Vietnamese officials in relation to the Note Printing Australia bribery allegations. ==Heritage listings==

The following Reserve Bank buildings are included on the Australian Commonwealth Heritage List: • 20-22 London Circuit, Canberra: Reserve Bank of Australia Building, Canberra • 65 Martin Place, Sydney: Reserve Bank of Australia Building, Sydney ==See also==