Liz Truss Shouldn’t Mess With the Bank of England’s Independence
The central bank is not above criticism, but politics and monetary policy are best kept apart.
The Bank of England’s job is hard enough as it is.
Photographer: Anthony Devlin/Bloomberg
Liz Truss, who looks likely to become the UK’s new prime minister next month, has stirred controversy with recent statements on the Bank of England. To gather support in the Conservative Party’s leadership contest, she’s proposing a departure from “business-as-usual economic strategy.” Among other things, she wants to review the central bank’s mandate.
Nobody would claim all’s well with Britain’s monetary policy: According to the bank’s own forecasts, UK inflation will soon exceed 13% and the economy is heading toward a protracted recession. It’s important to understand what went wrong. But calling the bank’s independence into question will only dig the economy into a deeper hole.