What role for central bankers in the future? I have just been speaking to Stefan Ingves, governor of Sweden’s Riksbank, who argues that he and his colleagues may have to be more outspoken in the future in warning about risks to financial stability.
The Riksbank’s view is certainly worth listening to—after all, Sweden’s banking crisis in the 1990s has allowed the country to offer advice to the rest of the world on how to handle the storms of the past few years. Sweden’s financial system was stress-tested by the crisis in the Baltic countries – a forerunner of the bigger problems we have seen in southern Europe.
But his views could be controversial. The danger is of central bankers losing credibility if they cry wolf. A fuller report of our conversation will follow, but click on the video for an extract.