Central bankers from around the world have expressed full support for U.S. Federal Reserve Chair Jerome Powell. This comes after President Donald Trump escalated his confrontation with the Fed by threatening criminal charges. The central bankers, including European Central Bank President Christine Lagarde, emphasized the importance of central bank independence for economic stability. The dispute ostensibly centers on Powell's congressional testimony in June about renovation costs, but Trump has criticized Powell for not cutting rates faster. Economists warn that a politicized Fed could harm its credibility.
China has been expanding use of digital currencies as it promotes wider use of its yuan, or renminbi, to reflect its status as the world's second-largest economy. It also wants to challenge the dominance of the U.S. dollar in international trade and finance. Restrictions on access to Chinese financial markets and limits on convertibility of the yuan, or "people's money," are big obstacles blocking its global use. Still, Hong Kong already has stablecoin regulations and some Chinese experts are pushing for regulations to prepare for a possible stablecoin pegged to the yuan. Such moves follow President Donald Trump's signing last month of a law regulating stablecoins.
