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Bloomberg
Mexico’s central bank called for the preservation of its independence amid economist concerns that President Andres Manuel Lopez Obrador may encroach on its independence, as he has with other autonomous institutions.
One by one, the four heads of Banco de Mexico over the past three-and-a-half decades took the podium to praise the benefits of autonomy and the importance of price stability for society at a conference in Mexico City celebrating 25 years of independence.
Governor Alejandro Diaz de Leon called autonomy, granted in 1994, one of the most important economic reforms of recent years. His predecessor Agustin Carstens, now head of the Bank for International Settlements, urged the bank to educate citizens about the benefits of independence, noting that more than a third of Mexicans are too young to remember life before Mexico tamed the double-digit inflation that characterised the 1980s and 1990s.
In private conversations, a half dozen economists and conference attendees, who asked not to be named due to potential reprisals, said that despite Lopez Obrador’s insistence that he respects the autonomy, they fear eventually he’ll be tempted to push the central bank for looser monetary policy to lift a frozen economy.
Asked about Lopez Obrador’s view of Banco de Mexico, his spokesman, Jesus Ramirez, said that respecting its independence is a principle of president’s economic policy. “We haven’t intervened, and we aren’t going to intervene in 6 years of administration,†he said.
Asked if he sees autonomy at risk, Governor Diaz de Leon avoided answering the question directly. Everyone is entitled to their own view of monetary policy, and the best way to convince society of the need for autonomy is for the bank to do its work well.