ECB's Draghi warns central banks' independence under threat

NUSA DUA, Indonesia – Reuters

The independence of central bankers around the world is being threatened by governments demanding monetary support ranging from debt cancellation to bond purchases and lower rates, European Central Bank President Mario Draghi said on Oct. 13.

Italy's two ruling parties had considered asking the ECB to forgive 250 billion euros ($296 billion) of Italian debt it owns during their coalition talks in May before ditching the idea in the final version of their government accord.

"They’re asking to change rates, (debt) cancellation, they’re asking them to do other things, buy bonds," Draghi told a press conference at the International Monetary Fund's annual meetings in the Indonesian resort island of Bali.

Draghi did not mention Italy but cited Turkey, where President Recep Tayyip Erdoğan sharply criticized the central bank and repeated his opposition to high interest rates, shortly before the bank was due to announce a policy decision.

"Just look at what President Erdoğan asked the central bank to do about a month ago. It’s just a general sense that this is one of the risks in the geopolitical sphere," Draghi said.