Overview
- Minnesota’s state auditor and the treasurers of Colorado, Washington, and Massachusetts urged the president to back off the central bank, warning interference would raise borrowing costs for households, businesses, and states.
- The U.S. attorney’s office in Washington opened a criminal investigation into Chair Jerome Powell over testimony on Fed headquarters renovations, which Powell called a pretext for executive interference.
- The administration has moved to oust Governor Lisa Cook over alleged mortgage fraud, with the Supreme Court hearing arguments this week in the dispute.
- Foreign central banks issued an unusual show of solidarity for Fed independence, with a statement led by the European Central Bank and endorsed by counterparts in the UK, Canada, South Korea, and Australia.
- Analysts and historical examples, including Turkey’s recent experience, highlight that politically directed monetary policy tends to fuel higher inflation and financial instability.