Political independence of the central bank is considered to bring financial stability to a nation and therefore to foster economic growth by providing safe investment environments. However, granting a central bank autonomy is politically contentious because of the implications such independence will entail for politicians in terms of their ability to influence monetary policy. This chapter analyzes central bank independence in words and in deeds. The first part discusses the existing literature on central bank independence and problems associated with its measurement. The implications of this debate are analyzed with two Latin American countries, Brazil and Chile. In Brazil, the difficulty in reaching a political consensus on granting the central bank formal independence has led the government to confer “operational” independence since the mid-1990s. Despite the improvement in the financial stability of the country, the Brazilian central bank remains politically vulnerable because its independence is not guaranteed by the constitution, and the credibility of prudent monetary policy is not strong enough to deter speculative attacks in critical moments. The Brazilian experience is then contrasted with the Chilean case in which the central bank’s independence is constitutionally guaranteed.