Even as the advantages of having an apolitical monetary authority as an effective counterpoise to politically driven fiscal policies were becoming evident, democratic compulsions made fiscal discipline increasingly difficult. To get around this, starting 1990s, several countries voluntarily enacted fiscal responsibility laws.
The laws imposed limits on fiscal deficits/public debt on the one hand and prohibited primary financing of the fiscal deficit by the central bank on the other. This institutional framework allowed operational independence to the central bank in its conduct of monetary policy within a rule-based regime and was successful in keeping inflation low. 41.