IMF chief backs Jerome Powell and Fed independence

IMF Managing Director Kristalina Georgieva expressed support for Federal Reserve Chair Jerome Powell and emphasized the importance of central bank independence; Powell is under a government probe over renovation cost overruns and denies wrongdoing, and a legal case involving Fed Governor Lisa Cook is scheduled for the U.S. Supreme Court next week.

Kristalina Georgieva, managing director of the International Monetary Fund, said she supports Federal Reserve Chair Jerome Powell and highlighted the value of central bank independence. She told Reuters she has worked with Powell and respects his professionalism. Her comments came as Powell disclosed a government investigation into cost overruns on a renovation of two historic Fed buildings. Georgieva noted the IMF watches monetary and financial stability and pays particular attention to the Fed because of the U.S. dollar's global role. Key points: - Georgieva said central bank independence has evidence of serving businesses and households and that data-based decision making benefits the economy. - She expressed personal respect for Jerome Powell's professionalism and noted peer support from other central bank leaders. - Powell announced an investigation into cost overruns on a $2.5 billion renovation project and has denied any wrongdoing. - The situation has drawn attention from U.S. lawmakers; the U.S. Senate would be involved in confirming any successor to the Fed chair. - A separate legal challenge to the termination of Fed Governor Lisa Cook is scheduled to be argued before the U.S. Supreme Court next week. Summary: Georgieva's remarks underscore the international emphasis on maintaining an independent central bank and the Fed's wider significance. Powell is under a probe and denies wrongdoing; the U.S. Senate remains relevant for any leadership change, and the legal case concerning Governor Lisa Cook will be heard by the Supreme Court next week.