A solid first year from Governor Lowe

Philip Lowe has notched up an impressive scorecard in his first year as Governor of the Reserve Bank of Australia, but greater challenges lie ahead. There are reasons to believe that economic growth and inflation won’t live up to Lowe’s lofty expectations. And Lowe is going to have to make a tough call on when and how fast to raise interest rates. If rates are raised too far, too soon, there’s a risk it will trigger the instability in the housing market and financial system that Lowe is so desperate to avoid.