{"id":2611,"date":"2026-01-13T02:50:57","date_gmt":"2026-01-13T02:50:57","guid":{"rendered":"https:\/\/finzexpert.com\/blog\/trumps-intimidation-of-jerome-powell-with-doj-probe-tests-fed\/"},"modified":"2026-01-13T02:50:57","modified_gmt":"2026-01-13T02:50:57","slug":"trumps-intimidation-of-jerome-powell-with-doj-probe-tests-fed","status":"publish","type":"post","link":"https:\/\/finzexpert.com\/blog\/trumps-intimidation-of-jerome-powell-with-doj-probe-tests-fed\/","title":{"rendered":"Trump&#8217;s &#8216;intimidation&#8217; of Jerome Powell with DOJ probe tests Fed"},"content":{"rendered":"\n<div id=\"RegularArticle-ArticleBody-5\" data-module=\"ArticleBody\" data-test=\"articleBody-2\" data-analytics=\"RegularArticle-articleBody-5-2\"><span class=\"HighlightShare-hidden\" style=\"top:0;left:0\"\/><\/p>\n<div class=\"group\">\n<p>The criminal investigation into Federal Reserve Chair Jerome Powell is testing the U.S. central bank&#8217;s independence again and reinforcing the view among global investors that they need to diversify away from U.S. assets.<\/p>\n<p>&#8220;That&#8217;s what seems to be transpiring this morning,&#8221; Julien Lafargue, chief market strategist at Barclays Private Bank, told CNBC&#8217;s &#8220;Europe Early Edition&#8221; on Monday.<\/p>\n<p>Futures on the <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-2\">S&amp;P 500<span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span>, <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-3\">Dow Jones Industrial Average<span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span> and the <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-4\">Nasdaq<span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span> all moved lower on Monday after the Department of Justice opened an investigation into the $2.5 billion renovation of the Fed&#8217;s headquarters.<\/p>\n<\/div>\n<div>\n<div class=\"Collapsible-proliveCollapsableContainer\" role=\"button\" tabindex=\"0\"><svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"256\" height=\"256\" viewbox=\"0 0 256 256\" aria-labelledby=\"title desc\" role=\"img\" focusable=\"false\" preserveaspectratio=\"xMinYMin\" class=\"Collapsible-stockChartIcon\"><title>Stock Chart Icon<\/title><desc>Stock chart icon<\/desc><g transform=\"translate(1.4065934065934016 1.4065934065934016) scale(2.81 2.81)\"><path d=\"M 87.994 0 H 69.342 c -1.787 0 -2.682 2.16 -1.418 3.424 l 5.795 5.795 l -33.82 33.82 L 28.056 31.196 l -3.174 -3.174 c -1.074 -1.074 -2.815 -1.074 -3.889 0 L 0.805 48.209 c -1.074 1.074 -1.074 2.815 0 3.889 l 3.174 3.174 c 1.074 1.074 2.815 1.074 3.889 0 l 15.069 -15.069 l 14.994 14.994 c 1.074 1.074 2.815 1.074 3.889 0 l 1.614 -1.614 c 0.083 -0.066 0.17 -0.125 0.247 -0.202 l 37.1 -37.1 l 5.795 5.795 C 87.84 23.34 90 22.445 90 20.658 V 2.006 C 90 0.898 89.102 0 87.994 0 z\" transform=\" matrix(1 0 0 1 0 0) \" stroke-linecap=\"round\"\/><path d=\"M 65.626 37.8 v 49.45 c 0 1.519 1.231 2.75 2.75 2.75 h 8.782 c 1.519 0 2.75 -1.231 2.75 -2.75 V 23.518 L 65.626 37.8 z\" transform=\" matrix(1 0 0 1 0 0) \" stroke-linecap=\"round\"\/><path d=\"M 47.115 56.312 V 87.25 c 0 1.519 1.231 2.75 2.75 2.75 h 8.782 c 1.519 0 2.75 -1.231 2.75 -2.75 V 42.03 L 47.115 56.312 z\" transform=\" matrix(1 0 0 1 0 0) \" stroke-linecap=\"round\"\/><path d=\"M 39.876 60.503 c -1.937 0 -3.757 -0.754 -5.127 -2.124 l -6.146 -6.145 V 87.25 c 0 1.519 1.231 2.75 2.75 2.75 h 8.782 c 1.519 0 2.75 -1.231 2.75 -2.75 V 59.844 C 41.952 60.271 40.933 60.503 39.876 60.503 z\" transform=\" matrix(1 0 0 1 0 0) \" stroke-linecap=\"round\"\/><path d=\"M 22.937 46.567 L 11.051 58.453 c -0.298 0.298 -0.621 0.562 -0.959 0.8 V 87.25 c 0 1.519 1.231 2.75 2.75 2.75 h 8.782 c 1.519 0 2.75 -1.231 2.75 -2.75 V 48.004 L 22.937 46.567 z\" transform=\" matrix(1 0 0 1 0 0) \" stroke-linecap=\"round\"\/><\/g><\/svg><\/p>\n<div class=\"Collapsible-proLivePlayerCloseOrExpand\"><\/div>\n<\/div>\n<p><iframe title=\"U.S. 10-Year Treasurys.\" src=\"https:\/\/www.cnbc.com\/appchart?symbol=US10Y&amp;range=6M&amp;type=mountain&amp;embedded=true&amp;$DEVICE$=undefined\" height=\"460\" scrolling=\"no\" loading=\"lazy\" style=\"border:0;width:100%\"><\/iframe><\/p>\n<p>U.S. 10-Year Treasurys.<\/p>\n<\/div>\n<div class=\"group\">\n<p>Powell called the probe &#8220;a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President,&#8221; in a\u00a0video statement\u00a0tweeted by the Fed&#8217;s X account on Sunday. Donald Trump has previously accused Powell of being too slow to cut rates, which continue to weigh on consumers, particularly in accessing housing.<\/p>\n<p>Lafargue called the probe &#8220;a surprising move,&#8221; given that a new Fed chair will be announced in May when Powell&#8217;s chairmanship of the Fed is due to conclude.<\/p>\n<p>Steve Englander, head of global G10 FX research and North American macro strategy at Standard Chartered, said the probe was Trump trying to intimidate Powell with &#8220;the Maduro option&#8221;: a warning that he could be removed by other means, referring to how the Venezuelan president, Nicol\u00e1s Maduro, was seized in a U.S. military strike last weekend.<\/p>\n<p>He also warned about the pace of the administration&#8217;s actions.<\/p>\n<p>&#8220;The issue is the speed with which Trump is trying to do it,&#8221; Englander told CNBC&#8217;s &#8220;Squawk Box Europe&#8221; on Monday.<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108251003\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-108251003\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000400516\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><img decoding=\"async\" class=\"InlineVideo-videoThumbnail\" src=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/108251004-17682122491768212247-43456149356-1080pnbcnews.jpg?v=1768212249&amp;w=750&amp;h=422&amp;vtcrop=y\" alt=\"Trump is 'trying to intimidate the Fed,' says Standard Chartered's Englander\"\/><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>&#8220;Obviously, he has the midterms right in front of him. He wants to get interest rates down. I think he&#8217;s trying to intimidate the Fed \u2014 either by giving Powell the Maduro option of retiring and this all goes away, or by trying to get him off.<\/p>\n<p>&#8220;Unlike with Lisa Cook, this time there&#8217;s an actual accusation, as opposed to just stuff you&#8217;re throwing into the air.&#8221;<\/p>\n<p>It again places central bank independence \u2014 a key issue for investors throughout Trump&#8217;s tenure \u2014 in the spotlight, with attention turning to the U.S. 10-year yield and the potential for a broader drag on risk appetite into 2026.<\/p>\n<p>&#8220;I think it will bring forth that sentiment that investors need to diversify away from U.S. assets,&#8221; Lafargue observed. &#8220;It will potentially create some pressure on the long end of the yield curve over time.&#8221;<\/p>\n<\/div>\n<h2 class=\"ArticleBody-subtitle\">&#8216;Counterproductive&#8217;<\/h2>\n<div class=\"group\">\n<p>Nabil Milali, multi-asset and overlay portfolio manager at Edmond de Rothschild Asset Management, said the president&#8217;s strategy is &#8220;paradoxically counterproductive.&#8221;<\/p>\n<p>&#8220;By questioning the Fed&#8217;s independence, he is fueling upward pressure on rates, particularly at the long end of the curve, which we continue to avoid in our allocation,&#8221; Milali told CNBC in an email.<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-108250999\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-108250999\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000400514\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><img decoding=\"async\" class=\"InlineVideo-videoThumbnail\" src=\"https:\/\/image.cnbcfm.com\/api\/v1\/image\/108251000-17682121491768212147-43456131034-1080pnbcnews.jpg?v=1768212148&amp;w=750&amp;h=422&amp;vtcrop=y\" alt=\"Barclays Private Bank's Lafargue calls Powell probe 'surprising'\"\/><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>Looking to where investors may tilt their portfolios, Lafargue pinpointed China as &#8220;an increasingly popular trade,&#8221; highlighting the country as a continued beneficiary of the AI narrative.<\/p>\n<p>While investors are less optimistic about the eurozone, there are pockets of opportunities \u2014 particularly around Germany&#8217;s infrastructure and defense stimulus, said Lafargue, adding there may be a rebound in healthcare, material and energy in the U.K.<\/p>\n<p>While he said tensions between Trump and the Fed were &#8220;not a new narrative,&#8221; he added investors needed to understand &#8220;how quickly this thing can play out.&#8221; &#8220;We&#8217;ve heard this U.S. administration repeatedly critique the Fed\u2026 it may also accelerate the nomination of the new Fed chair potentially at Davos,&#8221; he added.<\/p>\n<\/div>\n<h2 class=\"ArticleBody-subtitle\">Credibility gap<\/h2>\n<div class=\"group\">\n<p>Milali said the latest spat raises the risk that Powell&#8217;s successor &#8220;will have little credibility in the eyes of investors&#8221;, and will ultimately be subject to President Trump&#8217;s directives.<\/p>\n<p>&#8220;The Trump administration&#8217;s latest attack on the Fed confirms that the goal of challenging the central bank&#8217;s independence has never been abandoned,&#8221; Milali added.<\/p>\n<p><em>\u2014 CNBC&#8217;s Tasmin Lockwood contributed to this report.<\/em><\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The criminal investigation into Federal Reserve Chair Jerome Powell is testing the U.S. central bank&#8217;s independence again and reinforcing the view among global investors that they need to diversify away from U.S. assets. &#8220;That&#8217;s what seems to be transpiring this morning,&#8221; Julien Lafargue, chief market strategist at Barclays Private Bank, told CNBC&#8217;s &#8220;Europe Early Edition&#8221; [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":2612,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[2583,651,2582,1037,1038,2574,2584,380],"class_list":["post-2611","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-loan","tag-doj","tag-fed","tag-intimidation","tag-jerome","tag-powell","tag-probe","tag-tests","tag-trumps"],"_links":{"self":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/posts\/2611","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/comments?post=2611"}],"version-history":[{"count":0,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/posts\/2611\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/media\/2612"}],"wp:attachment":[{"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/media?parent=2611"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/categories?post=2611"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/finzexpert.com\/blog\/wp-json\/wp\/v2\/tags?post=2611"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}