Global financial markets experienced heightened volatility on January 12, 2026, following the unexpected announcement of a criminal investigation into US Federal Reserve Chair Jerome Powell. The Department of Justice's move has sparked intense debate about central bank independence during a critical period for global economic recovery.
Asian markets reacted swiftly, with Japan's Nikkei falling 2.3% and Hong Kong's Hang Seng Index dropping 1.8% in morning trading. Analysts suggest the probe could complicate ongoing efforts to stabilize currency markets and address inflationary pressures across the Asia-Pacific region.
"This development introduces unprecedented uncertainty," said Singapore-based economist Dr. Mei Lin. "While Asian central banks maintain strong institutional frameworks, the Fed's actions directly impact regional trade dynamics and investment flows."
The investigation comes as Southeast Asian nations prepare for crucial APEC finance ministers' meetings scheduled for late January. Market observers note particular concern about potential ripple effects on emerging economies already grappling with debt sustainability challenges.
