Jerome Powell Claims Trump Admin Launched Probe To Threaten Him Over Interest Rates

Federal Reserve Chairman Jerome Powell announced on Friday that he was under investigation, and claimed that President Donald Trump’s administration was using the threat of an indictment to as a punishment for his refusal to lower interest rates at the president’s direction.

Powell posted a video in conjunction with a press release on Saturday, explaining the Trump administration’s rationale for launching the probe and then pivoted to say that he believed the real reasons for the investigation were political.

WATCH:

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

— Federal Reserve (@federalreserve) January 12, 2026

“On Friday, the Department of Justice served the Federal Reserve with grand jury subpoenas, threatening a criminal indictment related to my testimony before the Senate Banking Committee last June. That testimony concerned in part a multi-year project to renovate historic Federal Reserve office buildings,” Powell said.

“I have deep respect for the rule of law and for accountability in our democracy. No one—certainly not the chair of the Federal Reserve—is above the law,” he added, before turning to suggest that the Trump administration was retaliating against him for refusing to adjust interest rates to the president’s satisfaction. “But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”

“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,” Powell claimed, arguing that the president was simply using those reasons as cover. “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.”

“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions—or whether instead monetary policy will be directed by political pressure or intimidation,” he added. “I have served at the Federal Reserve under four administrations, Republicans and Democrats alike. In every case, I have carried out my duties without political fear or favor, focused solely on our mandate of price stability and maximum employment. Public service sometimes requires standing firm in the face of threats. I will continue to do the job the Senate confirmed me to do, with integrity and a commitment to serving the American people.”

Trump has repeatedly threatened to either fire Powell or sue him — as recently as late December — and has accused him of “gross incompetence.”