Investigation of Fed chief Jerome Powell: What Trump has said about him

A Justice Department investigation into Federal Reserve Chair Jerome Powell is underway, reportedly approved in November. The investigation focuses on Powell allegedly misleading Congress about the $2.5 billion renovation of the Federal Reserve headquarters, a project approved during Trump's first term that is now $600 million over budget. While President Trump claims to know nothing about the specifics, he has publicly expressed his desire to remove Powell, criticizing his approach to lowering interest rates. This investigation escalates the tension between Trump and Powell, threatening the Fed's independence and potentially impacting confidence in the US economy. The Fed's next interest rates review meeting is scheduled for January 27-28.

In January 2026, US federal prosecutors opened a criminal investigation into Federal Reserve Chair Jerome Powell. The investigation centers around Powell's congressional testimony regarding the Federal Reserve's renovation project. Powell stated in a video that the investigation, initiated by the Trump administration, is a pretext to compromise the central bank's independence. The investigation's specific focus within Powell's testimony remains undisclosed.

In January 2026, several Republican lawmakers, including Senator Lisa Murkowski, publicly opposed President Trump's actions against Federal Reserve Chairman Jerome Powell. This followed a Justice Department threat to indict Powell, which Murkowski and others viewed as an attempt to undermine the Fed's independence. Murkowski expressed support for a plan to block Trump's Fed nominees and called for Congress to investigate the Justice Department's actions. Former Fed chairs also condemned the threat as an unprecedented attack on the central bank's independence. The conflict arises from Trump's increasing pressure on the Fed to lower interest rates, a practice seen as violating the central bank's autonomy. Powell's term is set to expire in May, with Kevin Hassett considered a potential replacement.

Republican Senator Thom Tillis has pledged to block all Federal Reserve nominations, including the upcoming chair vacancy, in response to a Justice Department criminal investigation into Fed Chair Jerome Powell. The investigation stems from Powell's June testimony before the Senate regarding the rising costs of the Fed's headquarters renovation. Tillis, a member of the banking committee, stated he will oppose any nominee until the legal matter is fully resolved. Powell confirmed the subpoena and suggested the probe is linked to the administration's frustration with the Fed's interest rate policy. The senator's move raises concerns about the independence of the Federal Reserve and the Department of Justice.

The Department of Justice has opened a criminal investigation into Federal Reserve Chair Jerome Powell, escalating Donald Trump's criticism of the central bank. The investigation, initiated by the US attorney’s office in the District of Columbia and approved in November, centers on whether Powell lied to Congress regarding renovations to the Fed’s office buildings. Grand jury subpoenas were served to the Fed on Friday. Powell insists the investigation is an attempt to undermine the Fed's independence in setting interest rates based on economic conditions, rather than political pressure. Trump has repeatedly attacked Powell and the Fed for not lowering interest rates as he desired, and has sought to exert greater control over the central bank's decisions. The inquiry includes an analysis of Powell’s public statements and an examination of spending records.

The Trump administration has initiated a criminal investigation into Federal Reserve Chair Jerome Powell, raising concerns about the independence of US monetary policy. The investigation stems from Powell's congressional testimony regarding a $2.5 billion renovation of the Fed's headquarters in Washington, D.C. Powell stated that the subpoenas served to the Fed were a pretext to undermine the central bank's independence in setting interest rates. He asserted that the Fed will continue to set interest rates based on economic conditions, resisting political pressure. This development follows Trump's repeated threats against Powell for not cutting interest rates faster and his attempts to remove another board governor, Lisa Cook.