As you know, Michele Bullock, the recently appointed governor of the Reserve Bank of Australia, publicly supported Fed Chair Jerome Powell. She released this very poignant statement at a recent press conference. Poised at the podium in a sharp light blazer, Bullock was commanding. Her decision to back Powell, signing a letter of support, is significant given her leadership this spring after former President Donald Trump railed against Powell and the federal reserve.
Prior to sending the letter, Bullock personally notified her Australian counterpart—Jim Chalmers, the Treasurer of Australia—of her plans before signing as well. Chalmers was glowing in his praise—stating unequivocally that central bank independence should be enshrined as a core principle. “I told her at the time that I consider that to be appropriate,” he noted.
Solidarity with Central Bank Independence
Bullock’s endorsement was contained within a longer joint statement signed by 16 central bank governors from around the world. This joint action signals that even in the face of political pressure, their support for central bank independence remains steadfast. Their statement reaffirmed their support for the Federal Reserve System and Chair Jerome H. Powell.
Chalmers is right to highlight the importance of this unity between the world’s top central bank leaders. “I think it’s unsurprising that central bank governors from around the world would support central bank independence,” he remarked. In his remarks, he acknowledged the enormous role Bullock played. He said that it is absolutely appropriate for her to champion such a critical cause.
A Professional Relationship
Jim Chalmers made much of his personal relationship with Jerome Powell. Of course, he underscored the immense respect that he has for Federal Reserve Chair Powell. “I’ve met with the chairman of the Federal Reserve on a number of occasions, and I’ve participated in a number of meetings with him over the years as well,” he said. Chalmers characterized Powell as “a very professional, very diligent public servant in the United States.”
His remarks underscore a deep and growing sense of urgency among financial leaders around the world. They argue that it’s especially important to maintain independence in central banking agencies. Chalmers is a fierce proponent of each of these principles. He rightly emphasizes that his reform initiatives are aimed specifically at strengthening the independence of Australia’s Reserve Bank.
Commitment to Independence
Chalmers reiterated his commitment to central bank independence, stating, “I am a very big supporter of central bank independence.” He went on to explain that his reforms were intended to strengthen this independence. Read closely, he is clearly intent on keeping controversial decisions made by the Reserve Bank and its board immune from outside influence. This focus ensures their freedom and impartiality.
He concluded his comments by emphasizing that he never forecasts any of the decisions to be made by the Reserve Bank. Rather, he accommodates and honors their autonomy and ability to self-govern. Beyond CBI, this development highlights a deeper resolve between global central bankers to preserve their institutions’ independence in the face of burgeoning political movements.
