In a significant appointment, UNSW economics professor Bruce Preston is set to join the Reserve Bank of Australia's interest-rate setting board for a five-year term beginning in March. He replaces Alison Watkins, who has served on the board since December 2020 and previously led Coca-Cola Amatil. This transition reflects a shift towards enhanced technical expertise on the board following a comprehensive review of the bank's operations and governance.

Jim Chalmers, the Treasurer, announced Preston's appointment, highlighting his extensive experience and respect in the field of macroeconomics. Given his previous roles within the Reserve Bank and as a senior advisor at Treasury, Preston is anticipated to bring valuable insights to the monetary policy discussions. His appointment is viewed as uncontroversial, aligning with the recent recommendations aimed at diversifying the skill set of the board members, especially in the wake of criticisms of the bank's decision-making processes.

Preston's upcoming participation in the bank's next two-day meeting will be crucial, as he will have the opportunity to influence the setting of interest rates that have far-reaching implications for the Australian economy. This change in the board's composition signals a broader effort to address challenges within the Reserve Bank and to improve the management of monetary policy in an evolving economic landscape.