He International Monetary Fund (IMF) He warned governments about the risks of violating the independence of the central banks, within the framework of the round trip between the US president Donald Trump and the president of the Federal Reserve (Fed), Jerome Powell.
The financial organization insisted after the update of its report of the perspectives for the world economy in the serious consequences that could lead to an advance on the autonomies of national monetary entities.
The chief economist of the IMF, Pierre-Loivier Gourinchaswarned that the loss of independence of central banks could leave efforts without effect to control inflation expectations and trigger a wave of financial and macroeconomic instability.
During the last months, Trump continuously pressed Powell and pointed out that it was a “beast” for not accessing the interest rates of the Fed.
In recent days, and after insulting Powell calling him “fool”, Trump clarified his words about the hierarch and assured that he is “a very good man” and that It would be “highly unlikely” to force its exit from the US Central Bank.
In allusion, Gourinchas said: “Crucially, the ambiguous and volatile panorama also requires clear and consistent messages of the central banks and the protection of the independence of the Central Bank, Not only in legal termsbut also in practice. “
When asked directly by Reuters about the crossing between Trump and Powell, the IMF official was elusive and stressed that anchoring the inflation expectations of the independence of the Central Bank “is really a fundamental pillar for macroeconomic stability in general.” “That is one of the lessons hard from the last 40 years”he added.
Finally, he stressed: “We have a very, very clear message about it: it is very important to maintain the independence of the central banks and put it into practice.”
Source: Ambito
