Powell quickly responded with a press release asserting the investigation is less about financial misconduct and more about political influence of Fed policy-making: "The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President," accusing the Administration of attempting to influence Fed interest rate policy (i.e., demanding the Fed lower interest rates more, and more often).
He cited affordability concerns and criticized rates of 20% to 30% under the prior administration. This move represents yet another unprecedented government intrusion into the marketplace by his administration, potentially disrupting how banks price credit and manage risk. While aimed at easing consumer burdens, it raises questions about enforcement, as Trump provided no details on implementation - whether through executive action or congressional legislation. Banking groups quickly opposed it, warning of reduced credit availability.