Lowe says he would stay at RBA helm as reforms unfold

Philip Lowe will stay on as the head of the Reserve Bank, if asked, and oversee a wide-ranging overhaul of the significant economic institution.

Responding to the independent review of the RBA, Dr Lowe welcomed the recommendations and said he would continue in the top job if the treasurer asks him to.

"If I was asked to continue, I would, if I'm not asked to continue I'll find another way to contribute to Australian society," he told reporters on Thursday.

His position will come up for review later in the year and the treasurer has said the review has not altered this process.

Dr Lowe also said he did not take the review personally as one of nine board members and one of 1500 staff.

"We don't always get it right, but we always try and do the right thing by that by the Australian people," he said.

The 51 recommendations in the review, including splitting responsibility for interest rates and general governance across two separate boards and moving to eight meetings a year instead of 11, all have in-principle support from the federal government.

Dr Lowe also agreed it was time for change and said the organisation would start implementing the suggestions overseen by a small leadership team. 

While the governor agreed with many of the findings, including the need to improve the bank's communication strategy in the wake of poorly handled forward guidance about interest rate settings staying at record lows until 2024, he said the description of how the board functioned did not fit his reality. 

"The idea that the board members sit there meekly and accept the recommendation that I put to them is very far from the reality I've lived as the governor," he said.

He welcomed the suggestion to include more monetary policy and financial experts on the board but defended the "diligence and expertise" of the other existing board members.

The governor was also mindful of striking the right balance when it comes to communication and said there was a danger of overdoing it.

"We're going to have to work out a way to have more people speak, and to do it in a consistent way that doesn't create noise," he said.

Dr Lowe said the shift to a lower frequency of meetings - as suggested in the review - could help strike a better balance.

Capital Economics' Marcel Thieliant said it appeared unlikely Dr Lowe would be reappointed.

"With a lot of the criticism directed at the bank's leadership and culture, it looks increasingly likely that Governor Lowe will be replaced when his term ends in September," he said.

ACTU secretary Sally McManus said it was time for the RBA to "rebalance its efforts towards achieving its objective of full employment, and away from imposing higher and higher interest rates on mortgage holders".

"We look forward to economic levers being used to support working people and make Australia's economy and workforce stronger and more equitable," she said.

Australian Chamber of Commerce and Industry chief Andrew McKellar said the changes would be successful if they "strengthened the bank's capability, fostering greater economic certainty for business and the broader economy".

"For the RBA to ensure price stability and full employment, it must have the legitimacy and credibility that come from having clear, carefully specified objectives, and being accountable for its outcomes," he said.