Global central bank chiefs, including Australia's Michele Bullock, have issued a rare joint statement, backing US Federal Reserve Chair Jerome Powell.
Bullock is among 11 global central bank chiefs to have signed a statement highlighting the importance of independence in central banks, something placed under question after Powell called out the probe as intimidation meant to pressure the central bank to slash interest rates.
"We stand in full solidarity with the Federal Reserve System and its Chair Jerome H. Powell," the heads of 11 of the world's largest central banks said in a rare joint statement.
The heads of the Reserve Bank of Australia, the European Central Bank, the Bank of England, the Bank of Canada and seven other institutions said Powell had acted with integrity and that central bank independence was crucial for keeping prices and financial markets stable.
"The independence of central banks is a cornerstone of price, financial and economic stability in the interest of the citizens that we serve," the statement said.
Trump reprises demand for rate cuts, slams Powell
Trump on Tuesday demanded again that Powell lower borrowing costs after a government report showed consumer prices rose 2.7 per cent in December from a year earlier, and reprised his accusations of wrongdoing over the renovations.
"Well, he's billions of dollars over budget. So he either is incompetent or he's crooked. I don't know what he is, but he doesn't, certainly doesn't do a very good job," Trump told reporters in Washington,
"We have very low inflation. That would give 'too-late Powell' the chance to give us a nice beautiful big rate cut," Trump said.
The head of America's central bank, Jerome Powell, will be criminally investigated for alleged "abuse of taxpayer dollars" after a renovation budget ballooned. It's part of a long-standing beef involving Donald Trump. Source: AP / Julia Demaree Nikhinson/AP
Asked when he expects to announce that decision, Trump said: "Sometime in the next few weeks."
Fed bank members reassert independence
Despite hopes that a leader handpicked by Trump might lead to more interest rate cuts, members of the central bank said neither Powell nor his successor would change policy suddenly to suit the president.
"All of my colleagues and I are committed to setting monetary policy, the best monetary policy for the economy at a particular time and for all Americans," St Louis Fed President Alberto Musalem said on Tuesday.
"I don't expect that commitment to change, regardless of who is the chair."
Independence from government influence has been the key foundation of modern central banking.
It remained the unquestioned standard until Trump started demanding lower rates and putting pressure on individual policymakers when they failed to oblige.
The outpouring of solidarity followed pushback from several lawmakers in President Donald Trump's Republican Party on Monday, including members of the Senate Banking Committee who have the power to block the president's nomination of a more biddable successor to Powell.
The current Fed chief's term ends in May. Powell revealed late on Sunday the US central bank had received subpoenas from the US Justice Department about what he told Congress regarding the US$2.5 billion (AU$3.7 billion) renovation of the Fed's headquarters in Washington.
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