Powell Claims DOJ Subpoenas Target Fed Independence Over Interest Rate Policy

TLDR:

• Powell received DOJ subpoenas threatening indictment over June Senate testimony on building renovations
• Fed chair claims real issue is central bank setting rates based on economics, not White House preferences
• Powell served four administrations and vows to continue duties despite unprecedented legal pressure
• Subpoenas test whether Fed maintains evidence-based policy or succumbs to political intimidation 

Federal Reserve Chair Jerome Powell announced that the Department of Justice issued grand jury subpoenas threatening criminal indictment over his June Senate testimony on building renovations. 

Powell characterized the action as retaliation for the Fed’s independent interest rate decisions rather than genuine concerns about his congressional testimony. 

The subpoenas mark an unprecedented escalation in tensions between the central bank and the current administration over monetary policy control.

DOJ Action Follows Senate Banking Committee Testimony

The Justice Department served the Federal Reserve with subpoenas related to Powell’s appearance before the Senate Banking Committee last June. 

His testimony addressed a multi-year renovation project for historic Federal Reserve office buildings. Powell stated the Fed maintained transparency with Congress throughout the renovation process through testimony and public disclosures.

“I have deep respect for the rule of law and for accountability in our democracy,” Powell said. He acknowledged no official, including the Federal Reserve chair, stands above legal scrutiny. 

However, Powell framed the DOJ action within a pattern of administration pressure on the institution.

Powell dismissed the stated justifications for the subpoenas as pretexts. “This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings,” he explained. 

The chair argued the criminal threat stems from the Fed setting interest rates based on economic assessments rather than presidential preferences.

Powell Commits to Continuing Senate-Confirmed Role

The Federal Reserve chair has served under four presidential administrations from both political parties. “In every case, I have carried out my duties without political fear or favor, focused solely on our mandate of price stability and maximum employment,” Powell stated. His focus has remained exclusively on the Fed’s dual mandate.

Powell described public service as sometimes requiring resilience against threats and intimidation. “This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions,” he said. 

The chair questioned whether monetary policy will follow data-driven analysis or political pressure.

Despite the unprecedented nature of the DOJ action, Powell pledged to continue his Senate-confirmed responsibilities. “I will continue to do the job the Senate confirmed me to do, with integrity and a commitment to serving the American people,” he stated. 

The chair’s statement represents a direct public challenge to what he characterized as the administration’s attempts to influence monetary policy through legal threats.