Climate-related risks to central bank independence: the de-politicisation and re-politicisation of the Bank of England in the transition to net zero
James Jackson, Mat Paterson and Dan Bailey (野狼社区 Metropolitan University) have published a new article with Taylor & Francis online on 鈥楥limate-related risks to central bank independence鈥�.
Faced with ever-growing climate-related financial risks, the role of central banks in climate governance has intensified debates surrounding central bank independence (CBI).
Informed by elite interviews with UK monetary policy experts and a discourse analysis of Bank of England reports, this article reveals the internal views on re-politicisation of the Bank and CBI catalysed by the mandate to 鈥榝acilitate the transition to net zero鈥�.
We find different interpretations of CBI that are shaped by perceptions of the Bank鈥檚 existing political status, with some claiming that the Bank is intrinsically apolitical and immune to re-politicisation, and others viewing CBI as fragile or a strategically-deployed discourse.
Across three distinct views of politics, and by extensions CBI, we identify dual dynamics of de-politicisation and re-politicisation that serve to legitimate and de-politicise prior mission creep whilst simultaneously licencing politicising debates on the bank鈥檚 institutional evolution.
We demonstrate that the Bank of England is an indispensable case study in the green central banking literature for understanding the political economy of CBI within the context of climate change.