Chicago Federal Reserve President Austin Goolsby sounded a note of caution on Thursday, saying the latest attacks on the central bank and Chairman Jerome Powell could have a negative impact on inflation.
“Anything that undermines or attacks the independence of a central bank is a mess,” Goolsby said in an interview with CNBC’s “Squawk Box.” “If you try to take away central bank independence, inflation will come back.”
The comments came days after Powell confirmed that the Justice Department had subpoenaed him over a multibillion-dollar renovation project at the Fed’s headquarters in Washington. The spending spree has been a bone of contention between the Fed and the White House, with recent developments pointing to possible criminal prosecution against Powell.
While Goolsby said he would not comment directly on legal issues, he supported Powell’s statement on Sunday that questions about the construction project could be seen as a pretext for President Donald Trump’s interest rate hike.
“I mean, if you’re conducting an investigation as an excuse because you don’t agree with tariff decisions, that’s a mess. “We shouldn’t be here,” he said.
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