Powell terms US Justice Dept action unprecedented, reaffirms Fed’s policy independence

NEW DELHI: Federal Reserve Chair Jerome H Powell has confirmed that the US Department of Justice has served the Federal Reserve with grand jury subpoenas, raising the spectre of a potential criminal indictment connected to his testimony before the Senate Banking Committee last June.

In a public statement, Powell said that his testimony had addressed, in part, a long-running renovation project involving historic Federal Reserve office buildings. Powell emphasised his respect for the rule of law, stressing that no individual, including the Fed Chair, is above legal accountability.

At the same time, he described the US Department of Justice action as unprecedented and occurring at a time of what he characterised as sustained pressure from the administration.

Video message from Federal Reserve Chair Jerome H. Powell: https://t.co/5dfrkByGyX pic.twitter.com/O4ecNaYaGH

— Federal Reserve (@federalreserve) January 12, 2026

He clarified that the threat of criminal charges was not related to the renovation project itself or to congressional oversight activities, noting that the Fed has routinely provided information through formal testimony and public disclosures to keep lawmakers fully informed.

Powell asserted that the underlying issue was the independence of the Federal Reserve’s monetary policy decisions, saying that the situation stemmed from the Fed’s commitment to setting interest rates based on economic data rather than political preferences.

Powell reiterated his long record of service under four administrations of both major parties, framing his actions as consistent with the Fed’s dual mandate of price stability and maximum employment, and independent of political influence.

He added that public service sometimes requires standing firm in the face of threats and affirmed his intent to continue executing his responsibilities.

As of the most recent Federal Reserve decision, the federal funds rate target range is 3.50 percent to 3.75 percent, following a 25-basis-point cut adopted in December 2025.

The next meeting of the Federal Open Market Committee to review and potentially adjust interest rates is scheduled for January 27-28, the official interest rate announcement is likely to be made on January 28th. (ANI)