Central Bank of Iceland governor Már Guðmundsson said small open economies must be willing to use capital controls – albeit with great caution – if they are to enjoy independent monetary policy, during a speech in London today (January 28).

Iceland defended itself with capital controls during the 2008 financial crisis, and the policy helped shield the economy from a worse economic collapse, Guðmundsson said. Indeed the IMF, long an opponent of capital controls, now takes a more accommodating