Albanese Downplays Ex-Treasurer Swan's 'Punching Itself In the Face' Criticism Of RBA's Monetary Policy

Prime Minister Anthony Albanese has played down former Labor Treasurer Wayne Swan's criticism of the Reserve Bank of Australia's (RBA) monetary policy, which the latter described as "punching itself in the face."

Swan denounced the RBA's policy as favoring economic dogma over sound decision-making, arguing that high interest rates were burdening households, which limited spending and pushed the economy in reverse, News.com reported.

Albanese distanced himself from Swan's comments in the media, saying that both RBA and his government worked to lower inflation.

"They are in charge of monetary policy, we are in charge of fiscal policy ... The fight against inflation is one we are all engaged with," Albanese told mediapersons on Friday.

Speaking to Nine, on Friday, Swan, who served as treasurer under the Rudd and Gillard governments, said he was "very, very disappointed" with RBA.

"It's counterproductive and it's not good economic policy," Swan said during a media interview. "If you look at markets, they're all forecasting rate drops. They're going down around the world," ABC News reported.

However, Swan's comments followed present Treasurer Jim Chalmers' comments, made after the release of June quarter national accounts, that high interest rates were "smashing the economy."

Later, Chalmers denied he was attacking the RBA and that the Labor government was working together with the central bank to combat inflation.

"Of course [that] wasn't my intention," he said. "I have a great deal of respect for the work of the Reserve Bank... I work really well and really closely with governor [Michele] Bullock. And as I said before, we've got the same objective..."

While Bullock declined to address Chalmers' comments that credited the government spending for keeping Australia's economy out of recession, she denied a rift with the Albanese administration.

"He's doing his job and I'm doing mine," she said.

Defending RBA's strategy to keep high interest rates, Bullock said it was necessary to combat inflation, which was troubling everyone, especially the most vulnerable.

"So the role of interest rates in this is to try and temper demand. That's what monetary policy does and it's working. It's clearly working. But we need to see the results in the inflation numbers," she said.