Overview
- Jerome Powell confirmed grand‑jury subpoenas tied to his June 2025 testimony on a roughly $2.5 billion Federal Reserve renovation and said the move reflects political pressure from President Donald Trump.
- Former Fed chairs including Alan Greenspan, Ben Bernanke and Janet Yellen called the criminal probe an unprecedented bid to undermine the central bank’s independence, as major central banks abroad voiced solidarity.
- Risk sentiment swung sharply with early declines in U.S. equities, the dollar and Treasuries giving way to rebounds in some indexes, while gold surged to record levels on safe‑haven demand.
- U.S. inflation held at about 2.7% year over year in December, with core at 2.6%, complicating the case for rapid rate cuts and keeping focus on the Fed’s late‑January policy meeting.
- Trump renewed calls for significant rate reductions and floated a one‑year 10% cap on credit‑card interest, a proposal that pressured financial stocks and added to policy uncertainty.