Federal prosecutors have opened a criminal investigation into Federal Reserve Chairman Jerome Powell, he said on Sunday.
In a video announcing the probe, Powell said the US Justice Department served the agency with subpoenas and threatened a criminal indictment over testimony he gave to a Senate committee about renovations to Federal Reserve buildings.
He called the probe unprecedented and claimed it was initiated due to him drawing Donald Trump's ire over refusing to lower interest rates despite repeated public pressure from the president.
The Fed chair is the latest official to find themselves in conflict with Trump and subsequently face a criminal investigation by the US Justice Department.
The BBC has contacted the Justice Department and the White House for comment.
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.
Powell expressed respect for the rule of law, stating, No one, certainly not the chair of the Federal Reserve, is above the law, but this unprecedented action should be seen in the broader context of the administration's threats and ongoing pressure.
Trump stated in an interview that he did not have any knowledge of the Justice Department's investigation into the Fed but criticized Powell's performance in the role. I don't know anything about it, but he's certainly not very good at the Fed, he remarked.
The probe, which has not been confirmed by prosecutors, would mark an escalation in Trump's ongoing disputes with Powell, whom the president nominated for the role as Fed chair in 2017.
Trump has consistently criticized Powell for not cutting interest rates quickly enough and has hinted at removing him. Critics argue that Trump's pressure undermines the Federal Reserve's authority to set interest rates free of political influence.
Senator Thom Tillis expressed opposition to any Fed nominee pushed by Trump until the legal matter is resolved, while Senator Elizabeth Warren indicated that dismissing Powell is part of a plan to compromise the independence of the Federal Reserve.
A criminal probe could complicate Powell's position and further impact U.S. monetary policy amidst inflation concerns. The investigation is being overseen by the US Attorney's Office for the District of Columbia, according to sources.
As uncertainty looms, precious metals markets reacted, with gold and silver prices experiencing significant rises.
