Global central banks back Federal Reserve, stress importance of independence

A group of leading international central banks has expressed solidarity with the US Federal Reserve and its Chair Jerome H Powell, underscoring that central bank independence is essential for economic and financial stability.

In a statement issued on January 13, the European Central Bank said it stood “in full solidarity” with the Federal Reserve System, adding that the independence of central banks serves the interests of the public by supporting price, financial and economic stability.



The statement followed remarks made by Powell on January 11 and highlighted that safeguarding central bank independence is critical, while fully respecting the rule of law and democratic accountability.

US President Donald Trump has stepped up pressure on Federal Reserve Chair Jerome Powell, with tensions escalating after the US attorney’s office in the District of Columbia opened a criminal investigation into Powell over renovations to the Fed’s historic office buildings and whether he misled Congress about the project. According to The New York Times, Powell has indicated that the administration threatened him with a possible criminal indictment, a move he linked to the Fed’s refusal to align interest-rate decisions with the president’s preferences.

Powell argued that the central bank sets rates based on economic evidence and public interest, warning that political intimidation could compromise monetary policy independence. Trump has repeatedly criticised Powell and demanded swift rate cuts, prompting concerns among critics that any attempt to remove or legally target the Fed chair would undermine the central bank’s autonomy.

According to the joint statement, Powell has carried out his role with integrity, remained focused on his mandate and demonstrated a consistent commitment to the public interest. International counterparts described him as a respected colleague held in high regard by those who have worked with him.

The statement was issued on behalf of the ECB Governing Council by ECB President Christine Lagarde and was supported by several global central bank heads, including the governors of the Bank of England, Sveriges Riksbank, Danmarks Nationalbank, the Swiss National Bank, the Reserve Bank of Australia, the Bank of Canada, the Bank of Korea, the Banco Central do Brasil and Norges Bank. Senior leadership from the Bank for International Settlements also endorsed the message.

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The European Central Bank echoed the position on social media, reiterating that central bank independence remains a cornerstone of stability and is vital for the people these institutions serve.