Federal Reserve chair Jerome Powell has denounced an “unprecedented” investigation by the US justice department into evidence he gave to the Senate as politically motivated and the latest example of President Trump’s anger at him for not cutting interest rates more quickly. Responding to news that the Federal prosecutors on Friday served the agency with subpoenas and threatened a criminal indictment over testimony he gave to a Senate committee on renovations to Fed buildings, Powell yesterday issued a video in which he stated: “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,” Powell said. Since August 2024 the US central bank has cut interest rates from 5.5% to 3.75%. Trump has repeatedly criticised Powell for not cutting the Fed’s funds rate to 1% or lower. The dollar slipped and US equity futures eased in trading in Asia, Reuters reported.

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