Global Central Bank Chiefs Intervene in Trump DOJ Probe of Fed Chair Powell
Central Bankers Circle Wagons as Political Storm Brews
When the world's top monetary policymakers start coordinating phone calls, you know something's up. This time, it's not about interest rates or inflation targets—it's about shielding one of their own from what they see as political overreach.
The Unprecedented Alliance
Multiple governors from major economies have reportedly made discreet contact with U.S. officials. Their message? Back off. The coordinated pushback marks a rare moment of solidarity across typically rivalrous financial institutions. They're arguing that investigating a sitting Fed chair for policy decisions sets a dangerous precedent—one that could politicize central banks globally.
Why This Matters for Markets
Central bank independence isn't just academic theory—it's the bedrock of currency stability. When politicians start second-guessing rate decisions, investors get nervous. And nervous investors do unpredictable things. Some are already whispering about capital flight scenarios if the probe intensifies.
The Crypto Angle
Here's where it gets interesting for digital asset enthusiasts. Every crack in traditional finance's foundation makes decentralized alternatives look more appealing. When central bankers are busy fighting political battles instead of managing economies, Bitcoin's "uncensorable money" narrative gains fresh ammunition. It's the ultimate hedge against institutional drama.
The Bottom Line
This isn't just bureaucratic infighting—it's a stress test for the entire global financial architecture. The outcome could determine whether monetary policy remains in technocratic hands or becomes another political football. Either way, the spectacle proves once again that traditional finance runs more on relationships and backroom deals than any textbook would admit. At least with blockchain, the rules are written in code instead of whispered in hallways.
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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