Overview
- Jerome Powell said the Federal Reserve received grand‑jury subpoenas and threats of criminal charges tied to his June congressional testimony and the central bank’s $2.5 billion headquarters renovation, vowing to continue his duties without political favoritism.
- The news triggered selling of U.S. assets in early Asian trading, with the Bloomberg dollar gauge down about 0.2%, S&P 500 and Nasdaq 100 futures lower, and Treasury contracts weaker before later U.S. trading steadied.
- Former Fed chairs Ben Bernanke, Alan Greenspan, and Janet Yellen issued a joint rebuke calling the DOJ action an unprecedented attempt to undercut central‑bank independence, while New York Fed President John Williams cautioned against political interference.
- Senators Tom Tillis and Lisa Murkowski said they would hold up Federal Reserve confirmations until the matter is resolved, and Senate Majority Leader Chuck Schumer labeled the probe an attack on the central bank’s autonomy.
- Market strategists and asset managers pointed to rising hedging demand and diversification away from dollar‑centric exposure, warning that prolonged politicization could weigh on confidence in the Fed and the dollar.