Central bank independence is all well and good. But even if a finance minister
has no control over his country’s central bank whatsoever, it’s still shocking
to see him criticize
the central bankers in public. Especially when the finance minister in question
is Agustín Carstens, minister of economy in Mexico and
former deputy managing director of the IMF.
Carstens has come out and said that Banxico’s rate hike last week was premature
– something which might well be true, but which is hardly going to reassure
foreign investors that Mexico’s fiscal-policy authorities are working hand-in-glove
with its monetary-policy authorities.
Carstens is a very good economist, and a very powerful man, but he, like David
Bonderman, might benefit from some PR coaching. Bob Rubin
never criticized Alan Greenspan, and Hank Paulson would
never criticize Ben Bernanke – not in public. This is
exactly the same.