US Justice Department Drops Probe Into Fed Chairman Jerome Powell

In a significant development, the US Justice Department has decided to halt its investigation into Federal Reserve Chairman Jerome Powell. The probe, initiated last year amid President Trump's ongoing feud with Powell, centered on allegations of excessive costs during renovations of Federal Reserve buildings. The administration's decision to drop the federal inquiry, as announced by US Attorney Jeanine Pirro, shifts the focus to an internal investigation led by the central bank's inspector general.

White House spokesman Kush Desai affirmed the administration's stance, emphasizing that American taxpayers deserve accountability for fiscal mismanagement. The White House also reiterated its confidence in Kevin Warsh, President Trump's nominee to succeed Powell, whose term is nearing its end. The support of key Republican figures, like Thom Tillis, was reportedly contingent on the resolution of this investigation, highlighting the political undercurrents surrounding Powell's tenure and the Fed's independence.

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American taxpayers deserve answers about the Federal Reserve's fiscal mismanagement, and the Office of the Inspector General's more powerful authorities best position it to get to the bottom of the matter.

Powell himself had previously characterized the investigation as "unprecedented," suggesting it stemmed from President Trump's frustration with the Fed's refusal to lower interest rates despite repeated public pressure. In a rare public statement, Powell had warned that the independence of the US central bank was at stake, framing the issue as a choice between setting monetary policy based on economic evidence or succumbing to political pressure and intimidation. This development underscores the complex relationship between the presidency and the Federal Reserve, particularly concerning monetary policy and the central bank's autonomy.

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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.