Yves Mersch: Necessity, proportionality and probity – central bank independence in unconventional times Speech by Yves Mersch, Member of the Executive Board of the European Central Bank, at the conference “The ECB and its watchers XX”, Frankfurt am Main, 27 March 2019. * * *  Introduction The benefits of central bank independence have been established and demonstrated time and again.
Inflation is costly. 1 History shows that governments lack the credibility to commit to timeconsistent monetary policy, and often subordinate it to other priorities. 2 Faced with elections, governments are tempted to boost short-term growth by stoking unexpected inflation. But in the long run, this just raises inflation expectations without any benefit to growth.