Free exchange - The perils of asking central banks to do too much

To manage the global financial crisis and the covid-19 pandemic, central banks intervened in a range of financial markets, in some cases buying corporate bonds and equities. Many central banks were handed new financial-stability responsibilities after the financial crisis. Where climate change poses financial-stability risks (by threatening systemically important insurers, say) central banks are right to take note. Politicians seem as though theyre ducking their responsibilitiesand, in the process, make central banks seem like political actors. Credibility depends, however, on the perception that central banks can indeed act independently.