Geldcast Update: Why are central banks independent? Case study: Brazil

Reuters

The new Brazilian president is putting a lot of pressure on his central bank. But how is he doing this? And how independent are central banks really?

How independent should a central bank be? This question is a perennial issue in the monetary policy debate. Recently it has gained momentum because the new Brazilian president, Luiz Inácio Lula da Silva, is putting his central bank under a lot of pressure. He even threatened to dismiss the central bank governor.

In the latest Geldcast Update, we take a closer look at this case: how exactly is the Brazilian president putting pressure on the central bank? What levers of power does he have? And why are most central banks independent in the first place?

From stock exchanges and bitcoin to inflation and monetary policy – the Geldcast Update features the latest from the world of international finance. Clear and entertaining for everyone who wants to stay up to date. The podcast is hosted by monetary economist and business journalist Fabio Canetg.

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Author Fabio Canetg completed his doctorate in monetary policy at the University of Bern and the Toulouse School of Economics. Today he is a lecturer at the University of Bern. As a journalist, he works for SRF Arena, Republik Magazin and SWI swissinfo.ch, where he hosts the monetary policy podcast “Geldcast”.