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Powell under investigation for Fed headquarters renovation

The Federal Reserve chairman speaks of an investigation used as a pretext after his clash with Trump over interest rates

Powell under investigation. Federal Reserve Chairman Jerome Powell is the subject of a federal criminal investigation related to the $2.5 billion renovation of the central bank’s headquarters in Washington, D.C., according to The New York Times. Powell himself called the investigation a pretext, arguing that the Fed set interest rates “based on the best assessment of what would serve the public,” and not following the preferences of President Donald Trump.

In a video statement released yesterday, Powell explained that the Department of Justice subpoenaed the Federal Reserve for information about the renovation. In the video, shared on X, he specified that on Friday the Fed received subpoenas from a grand jury, with the risk of criminal charges in connection with his testimony before the Senate Banking Committee last June. That testimony also concerned the multi-year renovation project of the central bank’s historic buildings.

The context remains marked by the clash with the White House. Trump has repeatedly called for interest rate cuts and publicly criticized Powell when the Fed decided not to intervene. In the past, the president has called Powell an “idiot” and accused him of making it more difficult, especially for young people, to access the real estate market.

According to Powell, the central issue is not just the legal aspect. “The question is whether the Fed will continue to set rates based on economic evidence and conditions, or whether monetary policy will be driven by political pressure or intimidation,” he said. He also reiterated that no one is above the law, but called the initiative “unprecedented” and to be seen in the context of ongoing pressure from the administration.

Powell added that the Fed has always informed Congress about the restructuring project through testimony and public communications, rejecting the idea that the investigation is linked to specific irregularities. For the central bank chairman, it is rather a move that risks affecting the institution’s independence.

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