Overview
- Nine central bank leaders and senior BIS officials issued a joint statement expressing full solidarity with the Federal Reserve and Chair Jerome Powell and stressing that central bank independence is essential for price and financial stability.
- Signatories included Christine Lagarde of the ECB, Andrew Bailey of the Bank of England, and heads of Sweden, Denmark, Switzerland, Australia, Canada, South Korea, Brazil, and Norway, alongside BIS officials François Villeroy de Galhau and Pablo Hernández de Cos.
- The U.S. Department of Justice has opened a criminal investigation and issued subpoenas related to Powell, with reporting linking the scrutiny to his June testimony on the cost of renovating the Fed’s headquarters; no charges have been filed.
- Powell called the probe a pretext to undermine the Fed’s autonomy and vowed to set policy without fear or political favor, reinforcing his public defense of the institution’s independence.
- President Trump intensified criticism by saying he hopes Powell leaves soon and accusing him of overspending, as economists warn that politicizing the Fed could erode credibility and lift borrowing costs for U.S. debt; the Bank of Japan was notably absent from the list of signatories.