President Trump took aim at Jamie Dimon, the president of JPMorgan Chase & Co., on Tuesday, rejecting Dimon’s assertion that the Justice Department’s criminal probe into Federal Reserve Chairman Jerome Powell poses a risk to the central bank’s independence.
When asked about Dimon’s remarks, Trump stated, “I think he’s wrong,” defending the investigation, which has created market disruptions and faced bipartisan criticism. He insisted his administration is not undermining the Federal Reserve.
The president further claimed, “I think what I’m doing is fine, and there are bad people at the Fed.”
Trump continued to criticize Powell, arguing for a significant decrease in interest rates and implying that Dimon’s support for the Fed serves his own interests. “We should lower interest rates,” Trump remarked. Dimon had previously indicated, “I would probably like to see them go up,” suggesting that higher borrowing costs might benefit JPMorgan.
Dimon, who leads the country’s largest bank, has warned that undermining the Fed’s independence could produce adverse outcomes, including rising inflation expectations, which, in turn, may lead to increased interest rates.
“Everyone we know believes in the independence of the Fed,” Dimon told reporters. He expressed concerns about the implications of diminishing that independence: “In my opinion, that would have the opposite effect. It would probably raise inflation expectations and cause interest rates to rise over time.”
Meanwhile, Trump indicated he would move ahead with plans to appoint Powell’s successor in the near future, even as Wall Street executives and some Republican lawmakers push back against the investigation.
Senator Thom Tillis (R-North Carolina), who serves on the influential Senate Banking Committee, pledged to obstruct new Federal Reserve nominations until the investigation reaches a conclusion.
Other financial leaders shared Dimon’s worries, emphasizing that challenging the Fed’s autonomy could destabilize bond markets and erode confidence. Bank of New York Mellon CEO Robin Vince noted that political pressure on the central bank risks elevating interest rates rather than reducing them.
“Independent central banks, capable of setting monetary policy independently in alignment with a country’s long-term interests, have a longstanding presence globally,” Vince explained to reporters. “Let’s not take actions that could undermine the bond market’s foundations. A lack of confidence in the Fed’s independence means they’re unlikely to act in a way that would cause interest rates to rise.”
There is ongoing scrutiny regarding Powell’s congressional testimony from June concerning the Federal Reserve’s $2.5 billion renovations to its Washington headquarters. Questions have arisen about whether he misled lawmakers regarding the project’s scope and costs.
Powell has strenuously denied these allegations and confirmed that the Fed had received a grand jury subpoena. He called the investigation “unprecedented,” emphasizing that the renovations are funded entirely by the central bank and not taxpayer dollars, warning that the scrutiny threatens the Fed’s ability to set interest rates free from political influence.
Despite nominating Powell during his first term, Trump framed the investigation as a necessary accountability measure, attributing the situation to Powell’s perceived incompetence and asserting that it’s unrelated to monetary policy.
JPMorgan did not issue a comment.
