Apologies in advance to economists and traders for this description, but it looks like we are witnessing Revenge of the Nerds. It’s payback time for the economists and traders who put a 99 per cent likelihood on the Reserve Bank lowering interest rates last week and who appeared to have been caught with their pants down.

They had their savant credentials restored after Thursday’s weak employment data. Now it’s the Reserve Bank that is under the spotlight.

Reserve Bank of Australia governor Michele Bullock.Credit: Dominic Lorrimer

The weaker employment numbers provide clearer evidence that the central bank may have erred too far on the side of caution in keeping rates on hold.

Last week’s “shock” decision to keep rates steady made the forecasting collective look like chumps, and while most of them wouldn’t say it publicly, they were stung by the left-field move of Michele Bullock to wait for some more reliable monthly data before nudging........

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