Overview
- Federal prosecutors served grand-jury subpoenas to the Federal Reserve and notified Jerome Powell on Friday as part of a criminal investigation focused on the roughly $2.5 billion headquarters renovation and his June Senate testimony.
- The Justice Department declined to discuss specifics but said the attorney general has directed U.S. attorneys to prioritize suspected abuse of taxpayer funds.
- Powell said the subpoenas are a pretext tied to pressure from the Trump administration over monetary policy and warned about threats to the central bank’s independence.
- U.S. markets signaled risk-off sentiment with the VIX rising and Dow, S&P 500, and Nasdaq futures falling in early trading, reflecting uncertainty around the Fed.
- The New York Times reported the D.C. U.S. attorney approved the probe and is examining whether Powell misled Congress, while Trump told NBC he had no knowledge of the investigation; Powell’s term ends in May with a successor expected to be named this month.