Bank of England boss warns of populism threat to central bank independence

Bank of England Governor Andrew Bailey has warned that central banks face a ‘serious challenge’ from rising populism and growing skepticism toward public institutions. Speaking at the London School of Economics, Bailey argued that central banks must be insulated from “short-term political pressures” while remaining accountable to Parliament.

Bailey noted that populist movements often frame central banks as “unrepresentative elite” obstacles to popular sovereignty. While he did not name specific leaders, his comments follow recent political friction involving the US Federal Reserve. In the United States, President Donald Trump has criticized the Fed regarding interest rate decisions, and former chairman Jerome Powell previously noted that the institution's independence was being undermined by political threats.

In the United Kingdom, the Reform UK party has criticized the Bank of England’s quantitative tightening program, citing taxpayer losses, though the party has stated it intends to maintain the bank's independence.