Chicago Fed President Austan Goolsbee said anything that is infringing or attacking the independence of the central bank "is a mess.†...

Core Viewpoint - Chicago Federal Reserve President Austan Goolsbee cautioned that recent attacks on the central bank and Chair Jerome Powell could negatively impact inflation, emphasizing the importance of the central bank's independence [1]. Group 1: Central Bank Independence - Goolsbee stated that any infringement on the independence of the central bank could lead to a resurgence of inflation [1]. - He expressed concern that ongoing investigations into the Fed's renovation project could be perceived as politically motivated, particularly in relation to interest rate decisions [2]. Group 2: Legal Issues and Political Context - Powell has been subpoenaed by the Justice Department regarding a multibillion-dollar renovation project at the Fed's headquarters, with cost overruns causing tension between the Fed and the White House [1]. - Goolsbee supported Powell's assertion that the investigation might be a pretext for political influence over interest rate policies [2].

Geopolitical Risks - Geopolitical risks are currently influencing investor sentiment, particularly regarding U.S. claims over Greenland, which is viewed as vital for national security [2] - A recent meeting involving U.S., Greenland, and Danish officials ended in "fundamental disagreement" over the ownership of Greenland [2] U.S.-Iran Tensions - Investor concerns are heightened due to rising tensions between the U.S. and Iran, with speculation about a potential military strike in response to Iran's actions against protests [3] - President Trump indicated a possible delay in military action, citing reports of a reduction in violence in Iran [3] Federal Reserve Independence - An ongoing investigation into Federal Reserve Chairman Jerome Powell raises concerns about the Fed's independence and potential political influence on monetary policy [3] - Global central bankers have publicly defended Powell, emphasizing the importance of central bank independence for economic stability [4] Economic Data - Investors are awaiting the release of weekly initial jobless claims, which will provide further insights into the economic landscape [4]

By Lefteris Papadimas and Howard Schneider ATHENS/WASHINGTON, Jan 14 (Reuters) - Federal Reserve Governor Stephen Miran said on Wednesday comments from foreign central banks in defense of U.S. central bank chief Jerome Powell were inappropriate, a remark that stood in contrast to an ​outpouring of public support for Powell, including from other Fed policymakers, after a sharp escalation of Trump administration pressure. "I don't think it ‌is appropriate for central bankers to get involved in non-monetar ...

Group 1: U.S. Political Developments - U.S. President Donald Trump has canceled all meetings with Iranian officials, indicating a shift away from diplomatic efforts to address the violent crackdown on protestors in Iran [1] - Trump's support for protestors highlights the ongoing anti-government demonstrations in Iran, which are among the largest in the region [1] Group 2: Oil Market Impact - WTI crude and Brent crude prices increased by over 2.5% during U.S. trading hours due to concerns that U.S. involvement in Iran could destabilize the oil market, given Iran's significant role as an oil producer [2] - The situation in Iran is particularly sensitive as it influences the Strait of Hormuz, a critical passage for global oil shipments [2] Group 3: U.S. Market Reactions - U.S. stock markets experienced a dip despite the core consumer price index for December being lower than expected, indicating persistent inflation concerns [3] - Investor anxiety has been exacerbated by Trump's derogatory remarks towards Federal Reserve Chair Jerome Powell, which may affect market sentiment [3] Group 4: Central Bank Independence Concerns - JPMorgan Chase CEO Jamie Dimon expressed concerns that undermining central bank independence could lead to higher inflation expectations and increased interest rates over time [4]

Group 1 - U.S. President Donald Trump has canceled all meetings with Iranian officials, indicating a shift away from diplomatic efforts to address the violent crackdown on protestors in Iran [1][2] - The cancellation of meetings has led to a more than 2.5% increase in WTI crude and Brent crude prices during U.S. trading hours, highlighting concerns over potential instability in the oil market due to U.S. involvement in Iran [2] - The situation in Iran, a major oil producer with influence over the Strait of Hormuz, raises the risk of market volatility, which could impact global oil supply and prices [2] Group 2 - U.S. stocks experienced a dip despite a cooler-than-expected core consumer price index for December, suggesting investor concerns about economic stability [2] - Morgan Stanley's chief economic strategist noted that while inflation is not reheating, it remains above target, indicating ongoing economic challenges [3] - JPMorgan Chase CEO expressed concerns that attacks on central bank independence could lead to increased inflation expectations and higher interest rates over time, which may further complicate the economic landscape [4]

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].

Investment Climate - Britain is becoming increasingly unattractive for investment, likened to Venezuela due to Labour's stringent net zero policies affecting the oil industry [7][8] - The chief executive of engineering group Hunting criticized the UK government's approach to carbon reduction, suggesting it has made the country "uninvestable" [7][8] Oil Market Dynamics - Oil prices have surged to two-month highs, with Brent crude reaching approximately $66 per barrel and WTI exceeding $61, driven by geopolitical tensions and drone attacks on oil tankers in the Black Sea [3][6][26] - The price of Brent crude rose by 2.9% following Donald Trump's comments urging Iranians to take action against their regime, contributing to market volatility [6][26] - Protests in Iran have led to a 14% increase in European gas prices over three days, marking the largest rise since March [5][54] Stock Market Reactions - US stocks experienced a decline, with the Dow Jones Industrial Average falling by 0.7% and the S&P 500 and Nasdaq both down by 0.2% amid persistent inflation concerns [1][28] - Oil companies such as BP, Shell, Chevron, and ExxonMobil saw stock price increases as oil prices rose, contributing to a boost in the FTSE 100 index [2][9][56] Geopolitical Influences - Geopolitical risks are at an all-time high, with analysts predicting potential spikes in oil prices due to ongoing tensions in the Middle East [4][26] - The US has imposed 25% tariffs on goods from countries trading with Iran, which could significantly impact global oil supply and prices [16][73]

JPMorgan Chase CEO Jamie Dimon slammed the Trump administration’s move to open an investigation into Fed Chair Jerome Powell over the $2.5 billion revamp of its headquarters, warning that threats to the central bank’s independence could raise interest rates and stoke inflation.GOP lawmakers and White House insiders accuse Powell of lying to Congress about the work during his testimony in June, prompting US Attorney Jeanine Pirro to step in and order the probe.But JPMorgan boss Jamie Dimon, speaking during a ...

Core Viewpoint - Central bankers globally express solidarity with U.S. Federal Reserve Chair Jerome Powell amid President Trump's escalating confrontation with the Fed, including a Justice Department investigation and threats of criminal charges [1] Group 1: Central Bankers' Support - Nine national central bank heads, including Christine Lagarde and Andrew Bailey, affirm Powell's integrity and commitment to public interest [1] - The statement emphasizes the importance of central bank independence for maintaining price, financial, and economic stability [1] Group 2: Importance of Independence - Central bankers highlight that preserving the independence of central banks is critical for serving citizens and upholding the rule of law and democratic accountability [1]