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Powell “has served with integrity, focused on his mandate and an
unwavering commitment to the public interest," read the
statement signed by nine national central bank heads including
European Central Bank President Christine Lagarde and Bank of
England Governor Andrew Bailey.
They added that “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."
The dispute is ostensibly about Powell’s testimony to Congress
in June over the cost of a massive renovation of Fed buildings.
But in a statement Sunday, Powell, abandoning his previous
attempt to ignore Trump’s relentless criticism, called the
administration’s threat of criminal charges “pretexts’’ in the
president’s campaign to seize control of U.S. interest rate
policy from the Fed’s technocrats.
Trump has repeatedly criticized Powell and the Fed for not
moving faster to cut rates. Economists warn that a politicized
Fed that caves in to the president’s demands will damage its
credibility as an inflation fighter and likely lead investors to
demand higher rates before investing in U.S. Treasurys.
Other signatories of the statement carried on the ECB's website
were Erik Thedeen, governor of Sweden's central bank; Christian
Kettel Thomsen, chair of Denmark's central bank; Swiss National
Bank Chair Martin Schlegel; Michele Bullock, governor of the
Reserve Bank of Australia; Tiff Macklem, governor of the Bank of
Canada; Bank of Korea Governor Chang Yong Rhee; Gabriel Galipolo,
governor of the Banco Central do Brasil.
Also attaching their names were François Villeroy de Galhau,
board chair of the Bank for International Settlements, and Pablo
Hernández de Cos, BIS general manager. The BIS is an
international organization of central banks based in Basel,
Switzerland.
One prominent central bank not included in the statement was the
Bank of Japan. The statement said that more signatures could be
added later.
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