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0-15 min
Economics

The Importance of Federal Reserve Independence

OVERVIEW

In this video, Ben Bernanke, Chairman of the Board of Governors of the Federal Reserve System (2006-2014), explains how important the Fed's independence is to the health of our economy.

History shows that one of the best things you can do to create a strong stable economy is to have strong central bank which is independent of political pressures. Central banks that are not independent that are subject to short-term political pressures are going to make short-term decisions that aren't the best for the economy. If you have though the freedom from those short-term pressures, then you can make decisions based on the longer-term interest of the economy, and you're much more likely to maintain low and stable inflation; you're much more likely to maintain a healthy growing economy. There's an enormous amount of evidence that shows that countries with strong central banks that are free from short-term political pressures, get better results and help the economy be more stable, keep inflation low, and help economic growth.

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