NO.079

APPOINTMENT OF MR GLENN STEVENS AS GOVERNOR OF THE RESERVE BANK OF AUSTRALIA

I am pleased to announce the appointment of Mr Glenn Stevens as Governor of the Reserve Bank of Australia for a term of seven years, with effect from 18 September 2006.

The appointment is made in accordance with section 24 of the Reserve Bank Act 1959 which provides for the appointment by the Treasurer of the Reserve Bank Governor and Deputy Governor.

This appointment heralds the end of a distinguished and highly successful decade of leadership of the Bank by Governor Ian Macfarlane. I would like to take this opportunity to record my sincere gratitude to Governor Macfarlane for his outstanding contribution to policy over his entire career and particularly over the last decade.

Australia’s economic policy success since 1996 has delivered outcomes which have been the envy of others around the world. We have had one of the longest sustained periods of strong economic growth in our history, with average annual growth of around 3½ per cent over the past decade. This extraordinary growth performance has been accompanied by low and stable inflation, with average annual inflation of 2½ per cent over this period. Perhaps most importantly, these outcomes have delivered employment growth averaging around 2 per cent, helping us to reduce our unemployment rate to an historic low of 4.9 per cent.

At the time of Governor Macfarlane’s reappointment in 2003, I agreed to his request that his second term be limited to three years so that his total term as Governor would be ten years. Mr Stevens, who has now been Deputy Governor for five years, comes to the position with the requisite balance of qualifications and experience.

Mr Stevens was born in Sydney in 1958. He was educated at the University of Sydney where he received a first class honours degree in economics. He subsequently obtained a Masters Degree from the University of Western Ontario.

Mr Stevens has had a distinguished career at the Reserve Bank of Australia. After holding various positions in the Bank prior to 1990, he accepted a position as Visiting Scholar at the Federal Reserve Bank of San Francisco.

Subsequently, Mr Stevens has held positions as Head of the Economic Analysis Department, the Head of the International Department, and was Assistant Governor (Economic) from 1996 to 2001, prior to his appointment as Deputy Governor.

Mr Stevens has impeccable credentials and the necessary experience which will enable him to accept the important responsibilities associated with the position as head of the Reserve Bank of

Australia. The Government is confident that the Bank and Australia will benefit greatly from the dedication and expertise he will bring to this office.

The appointment of Mr Stevens will create a vacancy at the Deputy Governor level in the Bank for which I will be considering candidates from both within and outside the Bank. This process will take some months.

I take this opportunity to congratulate Mr Stevens on his appointment.

SYDNEY

1 August 2006

Contact: David Alexander

0418 210 601