Here’s the **latest on Trump’s challenge to Federal Reserve Chair Jerome Powell — a clash that’s drawing intense political, legal, and economic scrutiny:
1) Escalation: DOJ Criminal Probe of Powell
The Trump administration has opened a criminal investigation into Fed Chair Powell, centered on his testimony about Federal Reserve headquarters renovations and potential misuse of taxpayer funds. Powell says the move was used as leverage to pressure the Fed over interest‑rate policy — something the Fed resists to preserve monetary stability.
Powell himself revealed that the Department of Justice threatened an indictment over that testimony — a highly unusual escalation in executive pressure on the Fed’s leadership.
2) Trump’s Public Attacks
President Trump has repeatedly criticized Powell’s performance, especially on interest‑rate decisions, calling for much steeper rate cuts and accusing him of failing to act quickly enough. He’s used sharp personal language and suggested Powell might be replaced.
Although Trump has at times denied direct involvement in the DOJ action, his rhetoric and policy pressure have been central to the widening feud.
3) Political and GOP Response
The move has drawn pushback from some Republican lawmakers, who worry that targeting the Fed chair politically could undermine the Federal Reserve’s independence — a long‑standing norm in U.S. monetary policy. There’s concern it could also complicate confirmations for future Fed nominees.
4) Broader Backlash and Central Bank Solidarity
Other central bankers — including leaders from major economies — have issued statements expressing “full solidarity” with Powell and stressing the importance of Fed independence. This kind of international backing is rare and reflects fears that political interference in central banking could destabilize markets.
Financial sector figures like JP Morgan CEO Jamie Dimon have also criticized the attacks, warning they could undermine credibility in U.S. monetary policy and potentially fuel inflation.
