This independence has and will continue to serve the ECB and the European public well. Second, institutional independence is necessarily accompanied with transparency and accountability. An independent institution is, at last resort, accountable to the general public in a modern democracy.
Like the other ‘star variables’, the neutral rate is an economic fundamental, but fundamental does not mean fixed. 4. The neutral rate is a real interest rate. Economic theory holds that it is real, inflationadjusted interest rates that matter for people’s saving and investment decisions.