The Reserve Bank of Australia (RBA) is assessing how technologies such as AI may impact the country’s economy, according to Governor Michele Bullock.

Speaking in Perth on September 3, 2025, Bullock said the effects of technological change on areas like inflation and the labour market remain uncertain, and policymakers should monitor potential outcomes.

Bullock noted that technological change, including AI, has always reshaped the labour market, with some roles likely to be redefined, others possibly displaced, and entirely new jobs created, reflecting patterns seen in the past.

While the RBA has acquired its first enterprise-grade graphics processing unit to develop AI-driven analytical tools, the bank has not yet begun using it for research and analysis.

Bullock clarified that the bank is not using AI to set monetary policy, but aims to leverage it to improve efficiency and amplify staff efforts in research and analysis.

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🔗 Source: Reuters

🧠 Food for thought

1️⃣ Central banks are preparing for AI disruption despite significant uncertainty

The Reserve Bank of Australia’s proactive approach to AI research demonstrates how central banks are investing in understanding technological disruption even when the economic effects remain unclear.

Governor Michele Bullock explicitly acknowledged “a lot of uncertainty about how the technological change will affect the economy,” yet the RBA acquired its first enterprise-class graphics processing unit to develop AI-driven analytical tools1.

This cautious but forward-looking stance reflects the challenge facing monetary policymakers worldwide: they must prepare for AI’s economic impacts without fully understanding what those impacts will be.

The RBA’s careful distinction, using AI for research and analysis but not for actual monetary policy decisions, illustrates how institutions are trying to harness AI’s benefits while maintaining human oversight of critical decisions1.

2️⃣ AI adoption creates a productivity-displacement paradox for policymakers

Research suggests AI will simultaneously boost productivity and displace workers, creating a complex challenge for economic management.

Goldman Sachs estimates that AI could displace 6-7% of the US workforce while enhancing labor productivity by approximately 15% once fully integrated2.

The research indicates that each 1 percentage point gain in productivity growth may temporarily increase the jobless rate by 0.3 percentage points, typically lasting around two years2.

This creates a policy dilemma: the same technology driving economic growth also generates short-term employment disruption, requiring careful management of the transition period.

For central banks like Australia’s RBA, this means monitoring both the productivity benefits that could reduce inflationary pressures and the employment effects that might require supportive monetary policy during the adjustment period.

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