DOJ Drops Powell Probe, Clearing Path for Warsh
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- Justice Department ended its criminal probe of Fed Chair Jerome Powell, with U.S. Attorney Jeanine Pirro saying the matter would shift to the Fed's inspector general, and adding she would not hesitate to restart the probe if warranted.
- The investigation focused on a $2.5 billion building renovation; a federal judge previously quashed related subpoenas, finding prosecutors had produced "essentially zero evidence" to suspect Powell of a crime.
- Kevin Warsh's confirmation to replace Powell now unblocks, as Sen. Thom Tillis had pledged to oppose Warsh until the probe was resolved; Powell's term as chair ends May 15.
- Warsh told the Senate Banking Committee that Trump "never once asked me to commit to any particular interest rate decision," even as Trump told CNBC he would be "disappointed" if Warsh did not immediately cut rates.
- Powell has said the probe was retaliation for the Fed's rate-setting independence, and indicated he may remain on the board through January 2028, denying Trump an additional seat to fill.
Why it matters: With Powell's term ending May 15 and Trump openly admitting he'd be 'disappointed' if Warsh didn't cut rates, the Fed's next chair inherits a $2.5 billion renovation controversy and a president who has publicly pressured the central bank more aggressively than any in modern history.
