Criminal investigation into Fed number one Powell. Bessent to Trump: it will be chaos in the markets
The investigation focuses on the $2.5 billion restructuring of the central bank's Washington headquarters. Criticism from former Fed presidents
Federal prosecutors are conducting a criminal investigation of the Federal Reserve chairman, Jerome Powell, focusing on the $2.5 billion renovation of the central bank's headquarters in Washington, D.C., and his related testimony to Congress.
Powell said the investigation was the result of President Donald Trump's long-standing frustration with the Fed's refusal to cut interest rates as quickly and intensely as the president requested.
"The threat of criminal indictments is a consequence of the Federal Reserve setting interest rates based on its best assessment of what will benefit the public, rather than based on the president's preferences," Powell said in a video tweeted from the Fed's X account.
Powell: the question is whether monetary policy will be driven by political pressure or intimidation
In the video (see above, ndr) Powell says: "On Friday, the Justice Department served Federal Reserve with subpoenas threatening criminal indictment in connection with my testimony before the Senate Banking Committee last June. That testimony concerned, in part, a multi-year project to renovate the Federal Reserve's historic office buildings."
Powell added: "The question is whether the Fed will be able to continue to set interest rates based on the evidence and economic conditions, or whether monetary policy will instead be driven by political pressure or intimidation. No one, and certainly not the Federal Reserve chairman, is above the law, but this unprecedented action should be seen in the broader context of the administration's threats and continued pressure. This new threat is not about my testimony last June or the renovation of the Federal Reserve buildings. It is not about Congress' oversight role; the Fed, through testimony and other public disclosures, has made every effort to keep Congress informed about the restructuring project. These are just pretexts'.
