From Bloomberg:
Federal Reserve Chair Jerome Powell said the US central bank had been served grand jury subpoenas from the Justice Department threatening a criminal indictment, a dramatic escalation of the Trump administration’s attacks on the Fed.
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In an interview with NBC News on Sunday, Trump denied having any knowledge of the DOJ’s investigation into the central bank.
The US dollar weakened on the news, falling against all its major counterparts, while gold extended gains to a record high. Futures on the S&P 500 Index fell 0.3%.
Powell said the Fed was served the subpoenas on Friday. The unprecedented move by the Trump administration marks an escalation of President Donald Trump’s longstanding feud with the Fed chair.
Chairman Powell’s response is here. The most concise explanation for these events:
This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings. It is not about Congress’s oversight role; the Fed through testimony and other public disclosures made every effort to keep Congress informed about the renovation project. Those are pretexts. 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.
