UBS Chief Economist: Concerns about the Fed's independence may lead to a hawkish stance.

UBS Chief Economist Paul Donovan wrote that launching a criminal investigation into the current Federal Reserve Chairman could ultimately help strengthen the central bank's independence. Market reactions indicate that investors are increasingly concerned about the Fed's ability to manage interest rates without political interference. Although asset prices have not fluctuated significantly overall, long-term US Treasury yields have risen and the dollar has weakened. Donovan stated that Powell's hawkish stance may mean he is unwilling to resign from his position as a Fed governor this year; meanwhile, there are signs that the US Senate may delay confirming the nomination of a new Fed Chairman. He also pointed out that market concerns about central bank independence could translate into a hawkish force in future monetary policy decisions. (Jinshi)