Subdue the Bank of the Republic
By Rodrigo Botero Montoya - [email protected]
TL;DR
- The government is showing explicit hostility towards the independence of the Bank of the Republic.
- This reaction reveals the government's non-compliance with the rule of law and separation of powers.
- The government attempts to shift the discussion of monetary policy to the electoral campaign.
- The appropriate forum for monetary policy discussion is the Bank's Board of Directors, not public debate or political campaigns.
- The government's desired monetary policy resembles that of authoritarian populist regimes focused on devaluing currency and financing government spending through monetary emission.
- Serious central banks, like the Bank of the Republic, are specialized, depoliticized, meritocratic, and independent institutions focused on low inflation and price stability.