Trump Administration Probe of Fed's Powell Sparks Backlash Over Independence

The long-standing tension between the White House and the Federal Reserve has reached a boiling point. According to Reuters, the Trump administration has launched a formal probe into Chair Jerome Powell, triggering fears that the central bank's independence is under siege.

Trump Administration Fed Powell Probe: A Direct Challenge

As of January 13, 2026, reports indicate the administration is scrutinizing Powell's past administrative actions and decision-making processes. While officials frame this as a matter of accountability, critics argue it's a calculated move to intimidate the Fed into aligning with the White House's economic agenda.

Market Anxiety and Institutional Pushback

The backlash was swift. Economists warn that compromising the Fed's autonomy could lead to long-term inflationary risks and market instability. Institutional investors are already factoring in a 'political premium' as Treasury yields showed immediate sensitivity to the news.