Trump says Jamie Dimon ‘wrong' to warn that DOJ's Jerome Powell probe threatens Fed independence

• The DOJ investigation centers on whether Powell misled Congress about the scope and cost of the Federal Reserve's $2.5 billion Washington headquarters renovation
• Multiple Wall Street leaders, including Dimon and Bank of New York Mellon CEO Robin Vince, warn that undermining Fed independence could raise inflation expectations and push interest rates higher rather than lower
• Sen. Thom Tillis (R-NC) on the Senate Banking Committee has vowed to block actions until the investigation is resolved, while former Goldman Sachs CEO Lloyd Blankfein called it an 'attempt at murder-suicide' for both institutions

Summary:

President Trump publicly rebuked JPMorgan Chase CEO Jamie Dimon on Tuesday, dismissing his warnings that a DOJ probe into Federal Reserve Chair Jerome Powell threatens central bank independence. Trump called Dimon "wrong" and defended the investigation, stating "I think it's fine what I'm doing. And we have a bad Fed person."

Key Players and Positions:

The conflict centers on a Justice Department investigation into Powell regarding a $2.5 billion Federal Reserve headquarters renovation, examining whether he misled Congress about the project's scope and luxury features. Trump argues interest rates should be "sharply lower" and suggested Dimon's defense of Fed independence is self-interested, claiming the JPMorgan chief benefits from higher rates.

Industry Pushback:

Multiple financial leaders voiced concerns about undermining Fed autonomy:

• Jamie Dimon (JPMorgan Chase): Warned that compromising Fed independence could raise inflation expectations and increase rates over time
• Robin Vince (Bank of New York Mellon CEO): Cautioned against "shaking the foundation of the bond market"
• Lloyd Blankfein (former Goldman Sachs CEO): Called the probe an "attempt at murder-suicide" for both institutions

Political Response:

Sen. Thom Tillis (R-NC) of the Senate Banking Committee vowed action until the investigation concludes, indicating bipartisan concern.

Market Implications:

The controversy has sparked market turmoil, with executives warning that political pressure on the Fed risks eroding confidence in monetary policy independence, potentially driving rates higher—the opposite of Trump's stated goal. Trump plans to name Powell's replacement within weeks despite the backlash. Powell confirmed the Fed received grand jury subpoenas in what he called an "unprecedented" situation.