Trump's Battle with the Fed Intensifies: Independence at Stake

The Trump administration threatens Federal Reserve Chair Jerome Powell with indictment, escalating attempts to influence interest rates. The move raises concerns about the central bank's independence. Republican Senator Thom Tillis opposes new Fed nominees, as Wall Street braces for potential fallout from tensions between Trump and the Fed.

The Trump administration has heightened its efforts against the Federal Reserve, threatening to potentially indict Chair Jerome Powell over remarks made to Congress about a building renovation project. Powell has criticized this move as a pretext to exert leverage over interest rate decisions, aligning with Trump's desire to dramatically reduce them.

This development, part of a broader agenda to influence the Fed, has drawn immediate criticism. Republican Senator Thom Tillis, from the Senate Banking Committee, questioned the Justice Department's credibility, declaring he will oppose any Trump nominees to the Fed until legal matters are resolved. This challenges the Fed's independence in setting U.S. monetary policy free from elected officials' influence who seek cheaper borrowing for political gain.

Powell, appointed by Trump in 2018, completes his term in May but may remain amid growing speculation. This situation unfolds shortly before the Supreme Court considers Trump's attempt to dismiss another Fed official, marking rising tensions that have alarmed investors and affected markets. Trump's looming pressures have sparked significant debate on economic governance.

(With inputs from agencies.)