Federal Reserve Chairman Jerome Powell speaks during a press conference following the Federal Open Markets Committee meeting at the Federal Reserve on December 10, 2025 in Washington, DC (Photo by Chip Somodevilla/Getty Images)
WASHINGTON – The feud between President Donald Trump and Federal Reserve Chairman Jerome Powell has expanded into a Justice Department investigation, raising alarm among some Senate Republicans because Trump will need broad support from Republican lawmakers to approve his pick for the next Federal Reserve chairman after Powell’s term ends in May.
Outgoing North Carolina Sen. Thom Tillis, who sits on the closely divided Banking Committee that will hold hearings on the next nominee, wrote in a statement that he would not approve anyone to fill Powell’s seat if Trump or administration officials try to further undermine his independence.
“If there was any doubt about whether advisers within the Trump administration were actively pushing to end the Federal Reserve’s independence, there should be none now,” Tillis wrote. “Now the independence and credibility of the Justice Department are in question.”
Tillis added that he plans to “refrain from confirming any Fed nominee – including the upcoming Fed Chair vacancy – until this legal matter is fully resolved.”
Powell defends himself in a video
Trump has repeatedly criticized Powell since retaking the Oval Office in January, pushing him to cut interest rates more quickly and signaling he wants to fire him.
Powell said a video This weekend, he disclosed that Justice Department officials on Friday “served grand jury subpoenas to the Federal Reserve and threatened criminal indictment related to my testimony before the Senate Banking Committee last June.”
Powell claimed the DOJ investigation is not just about overseeing the multi-year renovation project at the Fed’s offices in Washington, D.C., but “is a consequence of the Federal Reserve setting interest rates based on our best judgment of what serves the public, rather than the President’s preferences.”
“The issue here is whether the Fed will continue to be able to set interest rates based on evidence and economic conditions — or whether monetary policy will instead be driven by political pressure or intimidation,” Powell said.
Trump nominated for the first time Powell will become chairman of the Federal Reserve in November 2017 for a four-year term beginning in February 2018. He wrote in a statement that Powell “has demonstrated consistent leadership, sound judgment and policy expertise.”
“Mr. Powell will bring a unique background of government service and business experience to the Federal Reserve,” Trump wrote. “He previously served as undersecretary of the Treasury in the administration of President George HW Bush. Mr. Powell also has nearly three decades of business experience.”
The Senate voted 84 to 13 in January 2018 to confirm Powell for the role.
President Joe Biden re-nominated Powell in November 2021 for another four-year term, which began in May 2022 after the Senate session voted 80 to 19 to confirm it a second time.
Tillis influence on the committee
Trump has not publicly said who he will nominate to replace Powell as Fed chair, but whoever he chooses will have to pass the Senate Banking Committee to receive full House confirmation and actually assume the role.
The Banking Committee includes 13 Republicans and 11 Democrats, giving Tillis considerable leverage to block any Trump nominee from advancing if all Democrats on the committee also vote against reporting that person.
Massachusetts Democratic Sen. Elizabeth Warren, the committee’s ranking member, wrote in a statement: “Trump is abusing the Justice Department authorities like a would-be dictator so that the Fed serves his interests and those of his billionaire friends.”
“As Donald Trump prepares to name a new Fed chair, he wants to permanently oust Jerome Powell from the Fed board and install another sock puppet to complete his corrupt takeover of America’s central bank,” Warren wrote. “This committee and the Senate should not move forward with any Trump nominee for the Fed, including the Fed Chair.”
Chairman Tim Scott, R-S.C., had not released any public statements about the Justice Department’s investigation into Powell as of Monday morning.
Murkowski sees “forced experiment”
Alaska Republican Senator Lisa Murkowski, who is not on the committee, released a written statement after speaking with Powell on Monday morning in which she said: “It is clear that the administration’s investigation is nothing more than an attempt at coercion.”
“If the Department of Justice believes that an investigation into Chairman Powell based on project cost overruns is warranted – which is not uncommon – Congress must initiate an investigation into the Department of Justice,” Murkowski wrote. “The stakes are too high to look away: If the Federal Reserve loses its independence, the stability of our markets and overall economy will suffer. My colleague, Senator Tillis, is right to block all Federal Reserve nominations until the issue is resolved.”
Senate Minority Leader Chuck Schumer, D-N.Y., wrote in a statement that the Justice Department’s actions “represent the kind of bullying we all have come to expect from Donald Trump and his cronies.”
“Anyone who is independent and does not simply stand behind Trump will be investigated,” Schumer wrote. “Jay Powell and the Fed are not the reason Trump’s economy and poll numbers are in the toilet. If he’s looking for the person who caused this, he should look in the mirror.”
Former Federal Reserve chair, Treasury secretary and White House economic adviser released a written statement that the “independence of the Fed and the public perception of that independence are critical to economic performance, including the achievement of the goals of stable prices, maximum employment, and moderate long-term interest rates established by Congress for the Federal Reserve.”
“The reported criminal investigation into Federal Reserve Chairman Jay Powell is an unprecedented attempt to use prosecutorial attacks to undermine that independence,” they wrote. “This is how monetary policy is designed in emerging markets with weak institutions, with extremely negative consequences for inflation and the functioning of their economies in general. It has no place in the United States, whose greatest strength is the rule of law, which is the foundation of our economic success.”
White House press secretary Karoline Leavitt told reporters in the afternoon that she did not know whether Trump had seen Powell’s video but defended the president’s right to denounce the Fed’s actions under his leadership.
“Look, the president has every right to criticize the Fed chair. He has a First Amendment right, just like all of you,” Leavitt said. “And one thing is certain: The President has made it clear that Jerome Powell is bad at his job. The question of whether or not Jerome Powell is a criminal is for the Justice Department to figure out, and it looks like they intend to find out.”
