A Justice Department subpoena seeking information related to Federal Reserve Chairman Jerome PowellS past testimony marks a notable escalation in tensions between the White House and the central bank. Chairman Powell revealed Sunday that the DOJ has threatened criminal charges concerning his comments on the Fed’s building renovations, allegations he attributes to political motivations stemming from President Trump’s pressure for lower interest rates. The inquiry, approved by U.S. Attorney for the District of Columbia Jessie Liu, raises concerns about the independence of the Federal Reserve and the potential for political interference in monetary policy.
Federal Reserve Chairman Jerome Powell revealed Sunday that the Department of Justice has issued subpoenas to the central bank and threatened criminal charges related to his testimony concerning the Fed’s building renovations.
In a statement, Powell accused the investigation of being politically motivated, linking it to President Donald Trump’s repeated calls for the central bank to implement more aggressive interest rate cuts. The escalating tension between the White House and the independent Federal Reserve underscores the delicate balance between monetary policy and political pressure.
“The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the President’s preferences,” Powell stated.
“This is about whether the Federal Reserve can continue to set interest rates based on evidence and economic conditions, or whether, instead, monetary policy will be directed by political pressure or intimidation,” he added.
The investigation was reportedly approved in November by Jessie Liu, the U.S. Attorney for the District of Columbia, a former Fox News commentator and long-time ally of Trump, who was confirmed in August.
The Department of Justice stated in a release Sunday that it could not comment on specific cases, but noted that Attorney General Pam Bondi “has instructed her U.S. Attorneys to prioritize the investigation of any misuse of taxpayer funds.”
This action represents an unprecedented escalation in President Trump’s ongoing battle with the Fed, an independent agency he has repeatedly criticized for not lowering its key interest rate as quickly as he desires. The Fed’s independence is a cornerstone of U.S. economic policy, and this challenge raises concerns about potential interference.
The subpoena relates to Powell’s June testimony before the Senate Banking Committee regarding the Fed’s $2.5 billion plan to renovate two office buildings, which Trump has publicly criticized as excessive.
