The world’s most senior central bankers are rallying around Federal Reserve Chair Jerome Powell after he said the US government was attempting to pressure the central bank on monetary policy.
On Tuesday, a letter cosigned by the heads of 10 global central banking institutions defended Powell’s integrity, calling him a “respected colleague held in the highest regard by all who have worked with him.”
“We stand in full solidarity with the Federal Reserve System and its Chair Jerome H. Powell,” the letter read.
“The independence of central banks is a cornerstone of price, financial and economic stability in the interest of the citizens that we serve. It is therefore critical to preserve that independence, with full respect for the rule of law and democratic accountability. Chair Powell has served with integrity, focused on his mandate and an unwavering commitment to the public interest,” the letter read.
The statement was signed by Christine Lagarde, head of the European Central Bank, and Andrew Bailey, the Bank of England chief, as well as central bank bosses from Sweden, Denmark, Switzerland, Australia, Canada, South Korea, and Brazil, alongside the chair and general managers of the Bank for International Settlements.
The letter comes after Powell revealed on Sunday that the Federal Reserve had been served grand jury subpoenas by the Department of Justice, which was widely viewed as the latest escalation in an ongoing dispute between the central bank and the Trump administration over the path of interest rates.
“No one — certainly not the chair of the Federal Reserve — is above the law,” Powell said in a video statement on Sunday. “But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”
On Monday, a group of senior figures in US economics and monetary policy, including all three living former heads of the Fed, and five former Treasury secretaries, rallied behind Powell.
That statement called the investigation “an unprecedented attempt to use prosecutorial attacks to undermine” the independence of the Fed.
“It has no place in the United States whose greatest strength is the rule of law, which is at the foundation of our economic success,” the statement added.
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