Sixteen years ago, Ben Bernanke — then just a US Federal Reserve governor — waded into the slippery notion of central bank independence. During a trip to Japan, he told his hosts that “in the face of inflation … the virtue of an independent central bank is its ability to say ‘no’ to the government”.

But he then declared that the situation changes “with protracted deflation”, which Japan was in the midst of, and “a more co-operative stance” by the central bank towards the government is needed. “Greater co-operation for a time … [with] fiscal authorities is in no way inconsistent with the independence of the central bank”, he advised.

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