This decision regarding interest rates is of enormous importance to the economy in general, and it affects most people, either directly or indirectly. This raises the question as to how these decisions are made, the governance around the MPC decision-making process, and our accountability. Central banks are generally viewed as conservative institutions, and 'conservative' implies a reluctance to change.
However, there have been significant changes in how central banks operate in the last few decades. I would like to highlight the three main aspects to this central bank evolution or, perhaps more appropriately, revolution. The first is the move towards monetary policy independence. Many people assume that independence has been common practice since the establishment of central banks.