As most of us lost our bet on the Cup when Knight’s Choice surprised experts with a win in the big race, RBA Governor Michele Bullock has shown us she isn’t into gambling, refusing to take a punt on inflation being beaten.

How do I know this?

Well, firstly, the board didn’t budge on the cash rate yesterday. And secondly, Bullock didn’t mince her words, as she pondered the ongoing threats to inflation, such as Donald Trump’s promise of tariffs and a strong jobs market.  “This reinforces the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out,” she said. “Policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range.”

And to rub salt into the wounds of those praying for a rate cut and who loved hearing that the headline rate in the band was 2.8% in the September quarter, the Governor virtually scoffed at that number.

This is what her board said about this achievement in their statement: “Headline inflation is expected to rebound to be above the 2-to-3 per cent range in the second half of 2025 as the energy rebates unwind (as legislated) before returning sustainably to target in 2026.”

If you could get Bullock to be completely honest and political, she would say Treasurer Chalmers’ Budget that brought energy rebates may well have helped households deal with some of the energy impost in the cost of living. However, it took away some of the punishing effect that 13 interest rate rises was supposed to do to beat underlying inflation into the 2-3%.

In effect, she says it’s ‘over-lying’ to cheer inflation as being beaten, when underlying inflation is 3.5%. The RBA wants underlying inflation in the 2-3% band and that’s when they’ll cut.

So, when might that happen?

We get the December quarter Consumer Price Index on January 29. Then the RBA meets on February 18. My bet is that the underlying inflation reading will be close to or in the 2-3% band as it fell from 4% to 3.5% in the September quarter.

That said, looking at how Governor Bullock plays this rate cut drama, she won’t give in until the underlying rate is under 3%. History might judge her as hard, but she wants to be known as a successful RBA governor, even if it punishes Albo and Doc Chalmers who put her in the top job!

One last piece of history needs to be thrown into this story. You see, the RBA has a history of waiting too long to cut and even to raise.

In September 2020, when we were coping with the Coronavirus and lockdowns, former Treasurer and Prime Minister Paul Keating said the following about the RBA: “As history has shown, when a real crisis is upon us, the RBA is ­invariably late to the party. And so, it is again.”

Given the political damage this late rate cut is undoubtedly doing to the popularity of the Albanese Government, there’s bound to be other Labor politicians with similar negatives views about the new boss of our central bank.