Global central bank leaders have publicly backed US Federal Reserve Chair Jerome Powell, warning that political pressure on the Fed could destabilize global financial markets. The coordinated response comes as tensions rise between the central bank and the Trump administration, reigniting debates around monetary policy independence, market stability, and the future of risk assets like Bitcoin.
Central bank independence under pressure
In a joint statement released Tuesday, governors from 11 major central banks said they “stand in full solidarity with the Federal Reserve System and its Chair Jerome H. Powell,” emphasizing that central bank independence is essential for economic and financial stability worldwide.
The statement follows the opening of a criminal investigation into Powell over a $2.5 billion renovation of the Federal Reserve’s headquarters. While the probe is unrelated to monetary policy, it has intensified political pressure on the Fed and raised concerns among global policymakers about potential interference in interest rate decisions.
The signatories include European Central Bank President Christine Lagarde, Bank of England Governor Andrew Bailey, Bank of Canada Governor Tiff Macklem, along with central bank leaders from Sweden, Denmark, Switzerland, Norway, Australia, South Korea, and Brazil. Senior officials from the Bank for International Settlements also joined the statement.
Crypto market impact: volatility now, rotation later
Crypto industry leaders say the growing political pressure on the US Federal Reserve could inject short-term volatility into digital asset markets, while reinforcing Bitcoin’s long-term appeal as an alternative store of value.
Farzam Ehsani, CEO of crypto exchange VALR, noted that central bank independence is a cornerstone of macroeconomic stability. Any perceived political influence, he said, can weaken confidence in US dollar policy. For crypto markets, this often translates into higher volatility, with short-term risk-off moves followed by renewed interest in decentralized assets such as Bitcoin.
Ray Youssef, CEO of crypto app NoOnes, pointed out that recent market moves already reflect this shift. The US dollar has softened while gold and silver prices have climbed, signaling a rotation toward traditional safe havens.
Youssef added that potential interest rate cuts could increase liquidity and provide longer-term support for crypto prices. However, he cautioned that near-term conditions remain fragile, with Bitcoin experiencing selling pressure during US trading hours despite sustained institutional interest.
Trump allies emerge as potential Fed successors
US President Donald Trump has reportedly lined up several close allies as possible successors to Powell, many of whom openly favor lower interest rates. Among them is Kevin Hassett, a senior economic adviser to Trump and widely viewed as a leading candidate. Hassett has stated that Trump’s personal views would not directly dictate Federal Reserve policy.
Still, the administration has already increased its influence at the central bank. Last year, Stephen Miran, a close Trump ally, was appointed to the Fed’s board of governors. At his first policy meeting in December, Miran pushed for a 0.5% interest rate cut, signaling a more dovish approach aligned with Trump-era economic priorities.
Outlook for markets and Bitcoin
As global central banks rally behind Powell, investors are watching closely for signals of political interference in US monetary policy. While short-term uncertainty could pressure risk assets, many analysts believe prolonged concerns over Fed independence may ultimately strengthen demand for Bitcoin, gold, and other alternative assets as hedges against policy instability.
