Powell Says Trump Has Launched Criminal Investigation Into the Fed
Jerome Powell said a criminal investigation has been launched against the Federal Reserve, deepening the public conflict with the White House, while markets reacted calmly.
Olivia Carter
The conflict between the White House and the Federal Reserve has become public.
Federal Reserve Chair Jerome Powell said that President Donald Trump has launched a criminal investigation against the Federal Reserve. The president has denied any knowledge of such actions.
According to Powell, the US Department of Justice has issued subpoenas to members of the Federal Reserve, marking a sharp escalation in tensions between the central bank and the White House.
The formal basis for the investigation is a prolonged and increasingly expensive renovation of the Federal Reserve’s headquarters. Powell said this issue is being used as a pretext for political pressure after the Fed refused to comply with demands from the White House to cut interest rates.
Powell emphasized that, in his view, the investigation and the threat of criminal charges are not related to his testimony before Congress or to the construction work itself. Instead, he described the actions as a response to the Federal Reserve’s independent monetary policy.
Financial markets reacted, but without panic. The S&P 500 fell by around 0.5%, the US dollar weakened slightly, while gold and silver prices moved higher. The bond market remained broadly calm.
The episode highlights a rare moment of openly stated confrontation between the White House and the Federal Reserve, even as markets continue to absorb the developments with relative composure.
