Good morning from the City AM liveblog team.
What’s an easy way to tell apart a developed country from a less developed one?
One straightforward yardstick is the behaviour of state institutions and their relationship to government. If they are well run, they are operated by professionals independently from the executive. Or – the executive uses other arms of the state, such as law enforcement, to force through its own policy goals or replaces senior figures with party apparatchiks.
Which is why many were concerned yesterday that Federal Reserve chair Jerome Powell felt forced to give a public address over the latest police probe into the organisation, which Powell believes is a thinly-veiled attack on his defiance of Trump’s demands to cut interest rates. Is this an early sign of the crumbling of US state institutions?
In a highly unusual joint intervention, Janet Yellen, Ben Bernanke and Alan Greenspan rebuked the President’s most dramatic salvo on the US central bank, branding it an “unprecedented attempt to use prosecutorial attacks to undermine [Federal Reserve] independence”.
“This is how monetary policy is made in emerging markets with weak institutions, with highly negative consequences for inflation and the functioning of their economies more broadly,” they wrote in a statement also signed by a cross-party group of former treasury secretaries and senior economic advisers. “It has no place in the United States, whose greatest strength is the rule of law, which is at the foundation of our economic success.”
Here’s a summary of our top headlines from yesterday:
AI and defence demand for chips sends IQE shares soaring
Hargreaves Lansdown swipes new chief executive from Vanguard
Donald Trump credit card cap sends Barclays shares tumbling
Data centre planning applications rocketed more than 60 per cent in 2025
Immigration law firm put up for sale on insolvency market amid visa crackdownTfL to spend £100m a year on cleaning tubes amid graffiti spat