Accusation of false statements
US judiciary threatens Fed chief with indictment
The political pressure on the US Federal Reserve is increasing. Fed Chairman Powell made public investigations against him and the central bank into alleged false statements. However, he thinks this is a pretext.
According to its head Jerome Powell, federal prosecutors have opened an investigation into the US Federal Reserve. The Justice Department has served so-called subpoenas on the Federal Reserve, Powell said. These are written summonses or requests to hand over documents under threat of punishment. The ministry also threatened the central bank with charges.
Powell is alleged to have made false statements to the Senate in connection with the multi-year renovation of central bank buildings in Washington.
In his statement, Powell called the action a “pretext” to put more pressure on the independent central bank in the dispute over interest rate policy. “The issue is whether the Fed can continue to set interest rates based on facts and economic realities – or whether monetary policy will instead be driven by political pressure or intimidation,” he added.
Trump is putting pressure on Powell
President Donald Trump has long called for a reduction in the key interest rate. The Fed recently reduced this in several steps – but Trump is calling for clearer steps.
Trump regularly insulted Powell and also talked about firing him. It is unclear whether the president can actually fire the head of the independent central bank, who was confirmed by the Senate. Just a few weeks ago, Trump threatened to sue Powell for “incompetence.” Powell’s term ends next May.
