Opinion | John Kehoe

The RBA can’t mask Labor’s economic errors

Unless there is a sharp change of direction under the Albanese government, the economic realities will catch up with the politics.

John KehoeEconomics editor

Feb 4, 2026 – 1.55pm

When Reserve Bank of Australia governor Michele Bullock inevitably increased interest rates on Tuesday against a backdrop of runaway government spending and weak productivity growth, she could have borrowed a frank warning from the incoming US Federal Reserve chairman Kevin Warsh.

“The Federal Reserve is not a repair shop for broken fiscal, trade or regulatory policies,” Warsh said when he resigned from his first stint at the Fed 15 years ago.

John Kehoe is economics editor at Parliament House, Canberra. He writes on economics, politics and business. John was Washington correspondent covering Donald Trump’s first election. He joined the Financial Review in 2008 from Treasury.