In a remarkable show of global unity, eleven of the world's most powerful central bankers have publicly declared their "full solidarity" with US Federal Reserve Chair Jerome Powell. This unprecedented move comes as former President Donald Trump dramatically escalates his confrontation with the American central bank, with the Justice Department reportedly investigating and threatening criminal charges.
A Stark Warning on Central Bank Independence
The joint statement, published on the European Central Bank's website on Tuesday 13 January 2026, was signed by nine national central bank governors alongside two senior figures from the Bank for International Settlements (BIS). They praised Powell for serving "with integrity, focused on his mandate and an unwavering commitment to the public interest."
The signatories delivered a stark warning, stating that "the independence of central banks is a cornerstone of price, financial and economic stability in the interest of the citizens that we serve." They emphasised that it is "critical to preserve that independence, with full respect for the rule of law and democratic accountability."
The Escalating Political Confrontation
The dispute ostensibly stems from Powell's testimony to Congress in June concerning the cost of a major renovation of Federal Reserve buildings. However, the situation escalated over the weekend when Powell broke his previous silence. He labelled the administration's threat of criminal charges as "pretexts" in what he described as a campaign by the president to seize control of US interest rate policy from the Fed's technocrats.
Trump has repeatedly criticised Powell and the Fed for not cutting interest rates more aggressively. Economists warn that a politicised Federal Reserve, which yields to presidential demands, would severely damage its credibility as an inflation fighter. Such a loss of credibility could spook investors, likely leading them to demand higher interest rates on US Treasury bonds, increasing borrowing costs for the government and the economy.
Who Signed the Statement of Support?
The powerful list of signatories demonstrates the breadth of international concern. Alongside European Central Bank President Christine Lagarde and Bank of England Governor Andrew Bailey, the statement was endorsed by:
- Erik Thedeen, Governor of Sweden's Riksbank
- Christian Kettel Thomsen, Chair of Denmark's Nationalbank
- Martin Schlegel, Chair of the Swiss National Bank
- Michele Bullock, Governor of the Reserve Bank of Australia
- Tiff Macklem, Governor of the Bank of Canada
- Chang Yong Rhee, Governor of the Bank of Korea
- Gabriel Galipolo, Governor of the Banco Central do Brasil
Additionally, François Villeroy de Galhau, Board Chair of the BIS, and Pablo Hernández de Cos, the BIS General Manager, added their names. The BIS, known as the "central bank for central banks," is based in Basel, Switzerland. One notable absence from the statement was the Bank of Japan. The statement indicated that more signatures could be added at a later date.
Implications for Global Financial Stability
This collective action underscores the deep unease within global financial institutions about political interference in monetary policy. The defence of central bank independence is viewed not as a privilege for technocrats, but as a fundamental prerequisite for economic stability and low inflation worldwide. The public stand by such a distinguished group places significant international pressure on the situation, framing it as a threat to the established rules-based global financial order.
