Fed Chair Powell Faces Legal Heat Amidst Independence Affirmations

Federal Reserve Chair Jerome Powell addresses unprecedented grand jury subpoenas from the US Department of Justice, emphasizing his commitment to the rule of law and the Fed's independence in monetary policy decisions. The issue stems from Powell's Senate testimony and broader Fed autonomy concerns.

Federal Reserve Chair Jerome H Powell has revealed that the US Department of Justice has issued grand jury subpoenas to the Federal Reserve, igniting fears of a possible criminal indictment linked to his testimony before the Senate Banking Committee last June. Powell, in a public statement, clarified that his testimony partly dwelled on a prolonged renovation project concerning historic Federal Reserve office buildings.

Powell underscored his unwavering respect for the rule of law, asserting that no individual, including himself, is exempt from legal responsibility. However, he described the Justice Department's action as unprecedented, happening amidst what he perceives as enduring pressure from the current administration.

He clarified that the potential charges were unrelated to the renovation project or congressional oversight activities, pointing out that the Fed regularly submits information via official testimony and public disclosures to fully inform lawmakers. Powell stated that the core issue concerns the autonomy of the Federal Reserve's monetary policy decisions, arguing that it arises from the Fed's dedication to setting interest rates based on economic data instead of political influences.

Powell highlighted his extensive service under four administrations across both major political parties, portraying his actions as aligned with the Fed's dual mandate of ensuring price stability and maximum employment, free from political interference. He concluded by emphasizing that public service sometimes demands resolute standpoints in the face of threats, affirming his commitment to his duties.

As of the latest decision by the Federal Reserve, the federal funds rate target range is set between 3.50 percent and 3.75 percent, following a 25-basis-point reduction adopted in December 2025. The upcoming Federal Open Market Committee meeting to review and potentially adjust interest rates is slated for January 27-28, with an official interest rate announcement expected on January 28th. (ANI)

(With inputs from agencies.)