The US justice department is dropping its investigation into the Federal Reserve chairman, Jerome Powell, over alleged building cost overruns.
US Attorney Jeanine Pirro stated that instead, there will be an internal investigation led by the central bank's inspector general.
President Donald Trump has publicly critiqued the rising costs of the Fed's building renovations, highlighting a long-standing conflict with Powell. Among the controversies is Trump's recent nomination of Kevin Warsh as Powell's potential successor, a move that has faced obstacles from some Senate Republicans who are demanding the cessation of the investigation as a condition for their support.
“American taxpayers deserve answers about the Federal Reserve's fiscal mismanagement, and the Office of the Inspector General's more powerful authorities best position it to get to the bottom of the matter,” said White House spokesman Kush Desai.
Desai also emphasized the administration's confidence that the Senate will quickly confirm Warsh as the new Federal Reserve Chairman, which is seen as essential to restoring stability and public confidence in the Fed's decisions.
Trump has repeatedly urged the Fed to implement lower interest rates following his return to office, even suggesting he might take extreme measures against Powell if he does not resign after his term expires on May 15.
This investigation marked a pivotal point in Powell's tenure, especially as he had previously voiced concerns about the Fed's independence, stressing that its policy decisions should be based on economic evidence rather than political pressure.
Renovations to the Federal Reserve buildings, which include the Eccles and the Constitution Avenue, are crucial, addressing issues such as asbestos and lead contamination. This overhaul represents the first major updates since their construction in the 1930s.
