UBS Chief Economist: Concerns About the Independence of the Federal Reserve May Prompt Its Hawkish Stance

According to Jinshi News, UBS Chief Economist Paul Donovan wrote that a criminal investigation against the sitting Federal Reserve Chairman could actually help strengthen the independence of the central bank. Market reactions indicate that investors' concerns about the Fed's ability to manage interest rates without political interference are rising. Although asset prices are generally stable, long-term U.S. Treasury yields are rising, and the dollar is weakening. Donovan stated that Powell's tough stance may suggest he is unwilling to resign from his position as a Federal Reserve Governor this year.