Goolsbee: Political attacks on Fed threaten US inflation

Austan Goolsbee, President of the Federal Reserve Bank of Chicago, warned against the recent attacks on the Federal Reserve and its Chairman, Jerome Powell, explaining that such interference could negatively impact inflation.

“Anything that is infringing or attacking the independence of the central bank is a mess,” Goolsbee said during a CNBC “Squawk Box” interview. “You are going to get inflation come roaring back if you try to take away the independence of the central bank.”

The remarks came amid growing concerns over the US central bank's autonomy, particularly after Powell announced this week that he is subject to a criminal investigation related to a renovation project at the Fed’s headquarters. Powell, however, believes the true motive behind the investigation is his refusal to comply with the desires of the US administration.

Goolsbee also supported Powell’s assertion that questions surrounding the renovation project may serve as a pretext for President Donald Trump to impose his views on interest rates, emphasizing that the Fed's independence is crucial for achieving its economic mandates.