Washington (United States) (AFP) – US Federal Reserve Chair Jerome Powell said Wednesday that he did not plan to leave the central bank’s board until a Justice Department probe linked to renovation costs was completed. President Donald Trump has repeatedly insulted Powell over the central bank’s policies on setting the economy’s key interest rate.
In January, Powell revealed that the Justice Department had launched a probe linked to cost overruns in the Fed’s renovations. “I have no intention of leaving the board until the investigation is well and truly over, with transparency and finality,” Powell told a press briefing on Wednesday. He added that he had not decided whether to continue serving as a Fed governor after his term as chair is over in May. His term as a governor ends in 2028.
Last week, a US federal judge quashed subpoenas issued to the Federal Reserve as part of the investigation, with the court saying there was “a mountain of evidence” to suggest the probe was a pressure tactic. Judge James Boasberg’s order was scathing in its criticism of the Trump-appointed prosecutor’s office. “The Government has produced essentially zero evidence to suspect Chair Powell of a crime; indeed, its justifications are so thin and unsubstantiated that the Court can only conclude that they are pretextual,” he wrote.
US Attorney Jeanine Pirro has said the Trump administration would appeal the decision. Trump has been vocal about his preferences for lower interest rates, criticizing Powell and attempting to unseat another Fed Governor, Lisa Cook, over mortgage fraud allegations.
On Wednesday, the Fed’s key rate-setting committee decided to keep rates unchanged, as central bank policymakers digest the economic fallout of Trump’s war on Iran. Trump has nominated Kevin Warsh to replace Powell as Fed chair, but he is awaiting Senate confirmation. That confirmation is in doubt, with Republican Thom Tillis of the Senate Banking Committee recently vowing to oppose the nomination of any Fed nominees — including Warsh — until the Justice Department probe into Powell is resolved.
On Wednesday, Powell also said he would stay in office as Fed chair until his successor is confirmed, as has been the practice in the past.
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