In this book Dr Simon Guttmann draws on extensive interviews he has conducted, Reserve Bank and other archival documents and published work to show how politicians and their advisers, academic economists, the financial markets and the press each played a significant part in the evolution of monetary policy in Australia from the mid-1970s to the mid-1980s.
From 1978 the monetary projections set by Malcolm Fraser’s Liberal/National Party Coalition government were each exceeded. Despite this, monetary targeting remained a vital component of the government’s economic strategy.
While in opposition, the Labor Party was critical of monetary targeting, but Bob Hawke’s Labor government retained projections, chiefly because the markets remained committed to them. Financial deregulation made interpreting monetary growth extremely complicated, however, and in January 1985 projections were abandoned.