Roger Ferguson warns Fed independence under threat amid policy divides

Summary

Roger Ferguson says the DOJ probe into Fed Chair Jay Powell and political pressure are an unprecedented threat to Fed independence, even before any trial. He notes that international central banks issued unusual solidarity with the Fed, and that the next chair selection is being watched for independence. Ferguson also says incoming CPI, jobs, and GDP data will be unusually important because the FOMC is closely divided and the January meeting carries great uncertainty.

• Roger Ferguson calls DOJ scrutiny and political pressure an unprecedented threat to Fed independence.
• Ferguson says a Powell decision to remain on the board after his chair term would signal institutional concern.
• He describes the public race for the next Fed chair, including Kevin Hassett, Kevin Warsh, Chris Waller, and Rick Rieder, as unusual.
• International central banks released a rare statement supporting Powell and central bank independence.
• Ferguson says independent central banks are important for financial stability and inflation control.
• He says upcoming CPI, jobs, and GDP data will be closely parsed because the Fed is divided.
• He expects the January FOMC meeting to be marked by great uncertainty.