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BBC News - What on earth do they do now?

Unlike the Bank of England, for example, the ECB gets to write its own definition of price stability. Governments can't change its mandate - or expand on it. It's not even obvious, from the relevant statutes, that the countries of the eurozone could ever get rid of it.

This was a pre-condition for German support for the entire single currency project: there could be no question of the ECB bowing to the whims of the French - or for that matter, the Italians.
But I'm starting to wonder whether the ECB - and the single currency - might be better off if it were more beholden to politicians, with a clear chain of accountability from democratically elected governments.

Why? Because at least then, the political ramifications of the ECB's policies would be clear for all to see. The national governments would be able to clearly instruct the institution to act as the last line of defence for the euro, including the creation of unlimited amounts of liquidity.

Stephanie Flanders Economics editor

BBC News - What on earth do they do now?

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