Several Republican lawmakers have begun speaking out against the Trump administration’s criminal investigation into Federal Reserve chair Jerome Powell, with one senator going so far as to threaten all Fed nominations as a result.
Thom Tillis, a senator from North Carolina, vowed to block all Federal Reserve nominations after the justice department opened the investigation, inflaming tensions over the central bank’s independence.
Tillis, a member of the banking committee that oversees Fed appointments and who is retiring at the end of his term later this year, said on Sunday he would oppose any nominee for the Fed, including the upcoming 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,” Tillis wrote on X.
“It is now the independence and credibility of the Department of Justice that are in question.”
Alaska Republican senator Lisa Murkowski said she spoke to Powell on Monday morning, writing on X it was “clear the administration’s investigation is nothing more than an attempt at coercion”. She added that under that reasoning “Congress needs to investigate the department of justice”.
Louisiana senator John Kennedy said “we don’t need this” when asked about the investigation by reporters on Capitol Hill on Monday.
Congressmen Frank Lucas, from Oklahoma, and Mike Lawler, from New York, who sits on the House financial services committee, also weighed in with support for an independent Fed.
“While I fundamentally believe Chairman Powell was late in addressing inflation under Joe Biden and has been woefully slow in lowering interest rates over the past year, the independence of the Federal Reserve is paramount and I oppose any effort to pressure them into action,” Lawler told Politico.
The responses come days after the justice department subpoenaed the Federal Reserve as part of an investigation rooted in Powell’s testimony before the Senate in June about the ballooning costs of the Fed’s headquarters renovation. Powell confirmed the subpoena on Sunday and said the investigation was part of a pressure campaign linked to the administration’s frustration with the Fed’s interest rate policy.
“No one – certainly not the chair of the Federal Reserve – is above the law,” Powell said in a video posted by the Federal Reserve on X. “But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”
Since returning to office last January, Donald Trump has waged a year-long campaign urging Powell to lower interest rates, and has repeatedly suggested he might remove the Fed chair outright, though he has stopped short of doing so. Powell’s term expires in May, and Trump told Politico last month he would judge Powell’s successor on whether they were willing to cut rates immediately.
Trump told NBC News on Sunday he had no knowledge of the investigation, but criticized Powell’s performance. “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,” the president said.
Trump also denied the subpoenas had anything to do with interest rates. “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 said, adding that he believed the public was pressuring Powell.
The Federal Reserve operates as an independent entity within government, and is meant to shield monetary policy from political interference. Central bank independence is considered essential by economists for maintaining economic stability and credibility.
“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,” Powell wrote in his statement.
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