...
By Adeola Adeosun
Weekend Night Editor
0
Share
Newsweek is a Trust Project member
See more of our trusted coverage when you search.Prefer Newsweek on Googleto see more of our trusted coverage when you search.
President Donald Trump denied having any knowledge of the Department of Justice (DOJ) investigation into the Federal Reserve after the agency subpoenaed the central bank on Friday.
In an interview with NBC News Sunday night, Trump said "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," referring to Federal Reserve Chair Jerome Powell.
The comments came hours after Powell released a video statement announcing the DOJ had served grand jury subpoenas threatening criminal indictment related to his June testimony before the Senate about the Fed's office building renovations. Trump told NBC News that the investigation has nothing to do with interest rates, contradicting Powell's assertion that the probe is politically motivated pressure over monetary policy.
Read More on Politics
Newsweek reached out to the White House and Federal Reserve via email, as well as the DOJ via online form on Sunday for additional comment.
Why It Matters
Trump's denial of knowledge about the investigation raises questions about executive branch coordination and the independence of the Justice Department's prosecutorial decisions. The controversy has already sparked bipartisan concern in the Senate, with lawmakers threatening to block all future Federal Reserve nominees until the matter is resolved.
The dispute threatens the Fed's institutional independence, which has long been considered essential to effective monetary policy free from political interference. Powell joins a growing list of perceived Trump adversaries facing criminal investigations by the administration's Justice Department, intensifying concerns about the politicization of federal law enforcement.
What To Know
Powell stated Sunday that he believes the DOJ investigation is connected to the administration's yearlong campaign pressuring him to lower interest rates. Trump has repeatedly criticized the Fed for not cutting rates quickly enough. Trump denied this connection, telling NBC News: "No. I wouldn't even think of doing it that way. What should pressure him is the fact that rates are far too high. That's the only pressure he's got. He's hurt a lot of people. I think the public is pressuring him."
The investigation centers on the Fed's $2.5 billion renovation project for two historic office buildings in Washington, which has run about $600 million over budget. Powell's term as chairman ends in May 2026, though his position as a member of the Federal Reserve's Board of Governors doesn't expire until 2028.
A DOJ spokesperson said they could not comment on specific cases but noted Attorney General Pam Bondi "has instructed her U.S. attorneys to prioritize investigating any abuse of taxpayer dollars."
The Federal Reserve is not funded through taxpayer dollars. The central bank and its regional banks are funded by fees on services like check processing, loans to corporate banks, and income from its investment portfolio of U.S. government bonds, foreign currencies and other securities. Timothy Lauer, a spokesperson for the U.S. attorney's office for the District of Columbia handling the case, told NBC News the office does not comment on ongoing investigations.
What People Are Saying
President Donald Trump told NBC News on Sunday: "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. No. I wouldn't even think of doing it that way. What should pressure him is the fact that rates are far too high."
Federal Reserve Chair Jerome Powell said in the video statement released Sunday: "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."
Banking Committee Member Republican Sen. Thom Tillis of North Carolina: "I will oppose the confirmation of any nominee for the Fed—including the upcoming Fed Chair vacancy—until this legal matter is fully resolved. If there were any remaining doubt whether advisers within the Trump Administration are actively pushing to end the independence of the Federal Reserve, there should now be none."
**Top Democrat on Banking Committee Sen. Elizabeth Warren of Massachusetts said Trump is: "**Abusing the authorities of the Department of Justice like a wannabe dictator so the Fed serves his interests, along with his billionaire friends. This Committee and the Senate should not move forward with any Trump nominee for the Fed, including Fed Chair."
What Happens Next
The grand jury investigation will proceed under the U.S. attorney's office for the District of Columbia.
Senators Tillis and Warren have vowed to block all Federal Reserve nominees, including Trump's eventual choice to replace Powell as chair, until the investigation is resolved.
...
View 0 Comments
Submit Correction
View Editorial & AI Guidelines