Justice Department opens criminal investigation into Fed Chair Jay Powell

The Justice Department has opened a criminal investigation into Federal Reserve Chair Jay Powell, prompting an uncharacteristically sharp response from Powell and renewed concern about the Fed’s political independence, DealBook’s Andrew Ross Sorkin wrote. In a statement from the Fed and a rare video message, Powell said: "This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings.

It is not about Congress’s oversight role; the Fed through testimony and other public disclosures made every effort to keep Congress informed about the renovation project. Those are pretexts. 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 preferences of the president." He added: "This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation." Markets reacted with U.S.

stock futures slightly lower, the dollar down, gold and silver climbing to new records, and U.S. Treasury yields rising. President Trump said he had no advance knowledge of the case, telling NBC News, "I don’t know anything about it, but he’s certainly not very good at the Fed, and he’s not very good at building buildings," and denied the investigation was meant to pressure Powell to cut rates.

Key Topics

Politics, Jay Powell, Federal Reserve, Justice Department, Donald Trump, Jeanine Pirro