Wed, 03 Sep 2025

Wed, 03 Sep 2025 Bank of England 'very concerned' at Trump threats to US Fed

Andrew Bailey said the attacks, led by the US president, are "a very serious situation".

* Bank of England governor Andrew Bailey has expressed "very serious" concerns over threats to the independence of the US Federal Reserve, warning that it's a "very dangerous road to go down".
* Bailey joins European Central Bank president Christine Lagarde in criticizing President Donald Trump's attacks on the Fed and its chair Jerome Powell.
* The Fed's independence is crucial for global economic stability, as a loss of it would lead to a "very worrying" effect on economies worldwide.
* Trump has repeatedly attacked Powell over interest rates, calling him "too late" and "lousy" at his job, while Bailey says central banks must ensure economic stability to allow governments to make informed decisions.
* On domestic interest rates, Bailey notes that there's now more uncertainty about how quickly the Bank of England will continue to cut rates, with the next decision due on September 18.
* The UK is not yet seeing inflationary pressure from Trump's tariffs, but Bailey warns that supply chain pressures could become a problem if the global economy fragments.
* The interest rate on long-term government bonds has jumped to its highest level since 1998, making it more expensive for the government to borrow money, but Bailey says this shouldn't be the focus.
  >>