Ex‑Fed chairs condemn Trump administration move to weaken Fed independence

All living former Federal Reserve chairs publicly condemned an attempt to weaken the Fed's independence after the Justice Department opened a criminal inquiry into Chair Jerome Powell and served grand jury subpoenas related to his Senate testimony.

All living former chairs of the Federal Reserve expressed public condemnation of what they described as an attempt by the Trump administration to weaken the central bank's independence. The Justice Department has opened a criminal inquiry into Fed Chair Jerome Powell and served the Federal Reserve with grand jury subpoenas tied to his Senate testimony about renovations to Fed office buildings. Powell said the inquiry followed the Fed setting interest rates based on its assessment rather than the president's preferences. Several Senate Republicans also spoke about the matter, with some calling for the investigation to end or for nominees to the Fed to be paused. Key developments: - The Justice Department served the Federal Reserve with grand jury subpoenas and opened a criminal inquiry related to Chair Jerome Powell's Senate testimony. - All living former Fed chairs, including Alan Greenspan, Ben Bernanke and Janet Yellen, signed a statement condemning the reported action as an attempt to undermine the Fed's independence. - The former officials and a broader group of ex-Fed figures warned that prosecutorial pressure on central banks has led to negative outcomes for inflation and economic functioning in other countries, and said such tactics have no place in the United States. - Senators Thom Tillis and Kevin Cramer publicly criticized the Justice Department's pursuit of the matter; Tillis said he would oppose nominees until the legal matter is resolved, and Cramer called for a swift end to the investigation. Summary: Former Federal Reserve leaders and other ex-officials warned that the reported criminal inquiry and subpoenas are an unprecedented challenge to central bank independence and cited negative examples from other countries. Undetermined at this time.