Global central bank leaders back Fed Chair Powell amid federal investigation

Core Viewpoint - A group of global central bank leaders has expressed support for Federal Reserve Chair Jerome Powell amid a criminal investigation by the Department of Justice related to his testimony before the Senate Banking Committee regarding the Fed's renovation project [1][3][6]. Group 1: Central Bank Leaders' Support - The central bank leaders emphasized the importance of the independence of central banks for economic stability and expressed solidarity with Powell, stating he has served with integrity and commitment to the public interest [3][6]. - Signatories of the statement included prominent figures such as Christine Lagarde, Andrew Bailey, Michele Bullock, and Tiff Macklem, along with leaders from several other countries and the Bank for International Settlements [7]. Group 2: Investigation Context - Powell announced that the DOJ served grand jury subpoenas related to perjury allegations concerning his testimony about the renovation project, which he claims is a pretext for political pressure to lower interest rates [2][10]. - The renovation project, initially estimated at $1.9 billion in 2019, has seen costs rise to nearly $2.5 billion by 2025 due to increases in material costs and remediation efforts [17]. Group 3: Political Pressure and Responses - Powell stated that the investigation is not genuinely about his testimony or the renovation but rather about the Federal Reserve's ability to set interest rates based on economic conditions rather than political pressure [10]. - President Trump has publicly criticized Powell, calling for lower interest rates and accusing him of mismanagement, while denying knowledge of the subpoenas [13][14].