The independence of central banks is under threat The independence of central banks is one of the main pillars of maintaining the stability of the global economy, as this independence allows making monetary decisions away from direct political pressures. In this context, Christine Lagarde, the head of the European Central Bank, warned about the danger of attempts by former US President Donald Trump to impose his control over the Federal Reserve. She stressed that such an intervention is a direct threat to price stability and the credibility of US monetary institutions, which is necessarily reflected on world markets. When monetary policy becomes a tool of the executive branch, it loses its effectiveness in the face of inflation, and investor confidence in the markets weakens. This danger is not limited only to the United States, but extends to the economies associated with it via global trade networks and financial markets. Lagarde's warning came as a wake-up call that compromising the Fed's independence could lead to consequences that go beyond geographical borders, constituting a comprehensive shock to the international financial system. Possible implications for the US and global economy Political control over Fed decisions means that setting interest rates may be based on short-term electoral considerations, rather than long-term stability goals. This dynamic opens the door to sharp fluctuations in financial markets, a decrease in the confidence of international institutions in the US currency. For investors, any loss of the Fed's credibility translates into higher borrowing costs and fluctuating bond yields, which may put pressure on economic growth. As for globally, any disruption in the US economy, as the largest in the world, will be immediately reflected on trade flows, commodity prices and the movement of capital. Lagarde stressed that this scenario will increase the fragility of the global economy at a time when it is already witnessing challenges such as high inflation and slowdown in some emerging markets. Hence, the independence of the Federalist is not just an American domestic issue, but a central issue for the stability of the entire world economy. Between politics and economics, the Battle of trust Lagarde's warnings reveal a deeper battle between the logic of Economics and the requirements of politics. At a time when markets need clear and stable messages from central banks, some political leaders like Trump are seeking to use monetary policy tools to serve their own agendas. This discrepancy generates uncertainty and uncertainty, which is the worst environment for any investor or financial institution. Loss of confidence in the ability of the Fed to make independent decisions may lead to capital flight from the United States, or a reassessment of the dollar's status as a global reserve currency. Therefore, the warning is not limited to the danger of intervention by a particular individual, but goes beyond it to indicate the urgent need to preserve the independence of monetary institutions around the world. Without this Independence, monetary policy becomes exploited for political purposes،
