Jerome Powell Faces DOJ Threat as Fed Independence Comes Under Fire

Jerome Powell Faces DOJ Threat as Fed Independence Comes Under Fire

Good evening and we begin tonight with a dramatic and highly unusual moment at the very top of America’s financial system.

Federal Reserve Chair Jerome Powell has confirmed that the Department of Justice has served the central bank with grand jury subpoenas, raising the possibility of criminal charges connected to Powell’s past testimony before the Senate. That testimony focused on a long-running renovation of historic Federal Reserve buildings in Washington. But Powell is making it clear, he believes this goes far beyond construction budgets or congressional oversight.

In a rare and forceful public statement, Powell said this is about pressure, not paperwork. He argues the investigation is part of a broader effort by the Trump administration to influence how the Federal Reserve sets interest rates. And that matters, because the Fed is designed to operate independently, making decisions based on economic data, not political demands.

For viewers around the world, here’s why this is such a big deal. The Federal Reserve controls interest rates, which affect everything from mortgage costs and credit cards to global markets and currencies. Its independence is meant to protect the economy from short-term political interference, especially during election cycles or times of economic stress.

Also Read:

Powell, who has served under both Republican and Democratic presidents, says he has always followed the Fed’s legal mandate, keeping inflation under control while supporting jobs. He insists the central bank kept Congress informed about the renovation project and followed standard disclosure rules. In his view, the threat of criminal charges is not about accountability, but about intimidation.

The timing is also raising eyebrows. This comes as the Fed has resisted calls to rapidly cut interest rates, a move the White House has pushed for aggressively. Powell is essentially warning that if political pressure succeeds here, it could permanently weaken the Fed’s ability to act independently in the future.

Reactions are already pouring in. Supporters of the Fed say this investigation risks shaking confidence in U.S. institutions and financial markets. Critics argue no official should be beyond scrutiny. But even many legal experts note that criminal probes of sitting Fed chairs are almost unheard of.

Powell says he will not step aside and will continue to do the job the Senate confirmed him to do. He framed it as a moment where public service requires standing firm, even under threat.

As this unfolds, the stakes are high. For Wall Street, for global investors and for everyday households, the outcome could shape how independent America’s central bank remains in the years ahead.

We’ll continue to follow this closely. That’s the latest for now.

Read More: