Demographics force central banks into balancing act – Goodhart
Panel weighs risks to central bank independence from fiscal pressures, in part due to ageing societies
Demographic change could threaten central banks’ mandates, as fiscal dominance may force them to trade off inflation control and financial stability, economist Charles Goodhart warned during a panel discussion on September 2.
Rising life expectancy, Goodhart warned, is not the problem: we should be worried about healthy life expectancy. Fiscal and productivity pressures do not arise from healthy older people, but the increasing share who spend a significant number of years in care, he said.
“If
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