The International Monetary Fund (IMF) has extensive expertise in central bank legislation and a unique international insight into how it is designed in different countries. In light of this, the Riksbank invited IMF experts to present their view of the Riksbank Inquiry’s proposals, which resulted in a recently finalised report.
Among their conclusions, they write that the bank’s operational independence, that is the task of conducting independent monetary policy, should be safeguarded so that the Riksbank can discharge its mandate. Operational independence means having a mandate to decide on a wide range of measures aimed ultimately at safeguarding price stability and a long-term sustainable economy.
Defining in advance the tools available to the Riksbank to fulfil various objectives is not in line with international practice. In the IMF experts’ opinion, this can restrict the Riksbank’s room for manoeuvre, which can be particularly problematic in a crisis. At the same time, however, they stressed that substantial operational freedom must be offset by stringent demands for transparency to ensure subsequent accountability.