Global central bank chiefs intervene in Trump DOJ probe of Fed Chair Powell

Global central bank leaders moved fast after the Justice Department under Donald Trump, now the 47th U.S. president, opened a criminal probe tied to Powell.

The central bankers said the independence of central banks must stay protected and warned against political pressure on the Federal Reserve and Powell.

The letter said central bank autonomy sits at the center of price control, financial stability, and economic order. It stressed respect for law and democratic oversight while rejecting interference.

The signatories said Powell carried out his role with focus on the Fed’s mandate and commitment to the public interest. They described him as a professional colleague trusted by peers who worked with him.

Lawmakers and officials react as political pressure around Powell grows

The letter carried signatures from Christine Lagarde for the European Central Bank Governing Council, Andrew Bailey of the Bank of England, Erik Thedéen of Sweden’s Riksbank, Christian Kettel Thomsen of Denmark’s Nationalbank, Martin Schlegel of the Swiss National Bank, Ida Wolden Bache of Norges Bank, Michele Bullock of Australia’s central bank, Tiff Macklem of the Bank of Canada, Chang Yong Rhee of South Korea’s central bank, and Gabriel Galípolo of Brazil’s central bank.

The letter also included François Villeroy de Galhau and Pablo Hernández de Cos from the Bank for International Settlements. All said they stood in full solidarity with the Federal Reserve and Powell.

In Washington, Republican Senator Thom Tillis reacted first. Tillis sits on the Senate Banking Committee that reviews Federal Reserve nominees. He called the probe a huge mistake and said he would block any Trump pick to the Fed, including a successor to Powell, until the legal issue ends.

Senator Kevin Cramer backed that view the next day. Senator Lisa Murkowski also weighed in on X. She wrote that the stakes were too high and warned that markets and the broader economy would suffer if the Fed lost independence.

Even Senator Cynthia Lummis, who is often critical of Powell and gets along nicely with Trump, said the Justice Department’s use of a criminal statute looked like a heavy lift. But then added she saw no criminal intent.

Senator John Kennedy meanwhile, ever the comic relief on Senate floors, told reporters:-

“We need this like we need a hole in the head.”

Treasury-linked tensions also surfaced. Axios reported that Scott Bessent told Trump late Sunday that the investigation into Powell had made a mess.

Yesterday, Trump stubbornly denied knowing about the probe. He of course still criticized Powell, saying he was not very good at the Fed and not very good at building buildings.

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