An unprecedented conflict is unfolding in the United States between the executive branch and the Federal Reserve. Federal Reserve Chair Jerome H. Powell has said that the Department of Justice has served the Federal Reserve with grand jury subpoenas, effectively threatening criminal charges related to his testimony before the Senate Banking Committee last June, DKNews.kz reports.
In a public statement, Powell stressed that the situation goes far beyond routine legal scrutiny and directly raises the issue of the central bank’s independence.
Subpoenas and the threat of prosecution
According to Powell, the subpoenas were served on Friday. Formally, they relate to his Senate testimony, which included discussion of a multi-year project to renovate historic Federal Reserve office buildings.
Powell emphasized his respect for the rule of law and democratic accountability.
No one, certainly not the chair of the Federal Reserve, is above the law, - he said.
However, he made clear that the latest move cannot be viewed in isolation from the broader political context.
“This is not about building renovations”
The Fed chair stated bluntly that the threat of criminal charges has nothing to do with his testimony last June or with the renovation project itself.
This is not about Congress’s oversight role. The Federal Reserve, through testimony and public disclosures, made every effort to keep Congress informed. These are pretexts, - Powell said.
According to him, the real issue lies elsewhere.
Interest rates and political pressure
Powell suggested that the pressure stems from the Federal Reserve’s monetary policy decisions.
The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on evidence and economic conditions, rather than following the preferences of the President, - he said.
At stake, Powell argued, is a fundamental question: whether the Fed will continue to set monetary policy based on data and analysis, or whether it will be driven by political pressure and intimidation.
Independence of the Federal Reserve under strain
The Federal Reserve has long been regarded as one of the most independent institutions in the US system of governance. That independence allows it to take difficult and sometimes unpopular decisions on interest rates in pursuit of price stability and maximum employment.
Analysts warn that any attempt to influence the Fed through legal threats could set a dangerous precedent - not only for the United States, but for the global financial system as a whole.
“I will continue to do my job”
In his statement, Powell reminded the public that he has served at the Federal Reserve under four administrations, both Republican and Democratic.
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, - he said.
Powell made it clear that he does not intend to step aside or alter course under pressure.
Public service sometimes requires standing firm in the face of threats. I will continue to do the job the Senate confirmed me to do, with integrity and a commitment to serving the American people, - he said.
Why this matters
What is happening around the Federal Reserve chair goes far beyond a personal dispute. It touches on the balance of power, the independence of key institutions, and trust in the US financial system.
That is why Powell’s statement has triggered widespread reaction and, according to analysts, could become one of the most significant political and economic controversies of the year.
