#美国非农就业数据未达市场预期 The Federal Reserve Chair is in hot water again—this time with federal prosecutors.

On January 11, news broke that the U.S. Attorney’s Office for the District of Columbia has launched a criminal investigation into Fed Chair Jerome Powell, accusing him of making false statements during a congressional hearing regarding the Federal Reserve’s headquarters renovation project. The Department of Justice had already issued a grand jury subpoena to the Fed on the 9th, marking the official start of the investigation. That evening, Powell issued a rare statement to clarify, succinctly revealing the core issue: "The renovation project is just an excuse; the real conflict lies in the interest rate policy."

The story begins with that old building. The Federal Reserve’s Washington headquarters, built in the 1930s, faces issues such as outdated wiring and asbestos contamination. In 2019, the Board of Governors decided on a comprehensive renovation, with the budget eventually rising to $2.5 billion. In June last year, Powell reported to Congress that the project was "progressing normally and within budget." Now, prosecutors are re-examining the accounts, accusing him of concealing additional budget changes and potentially committing misconduct.

What’s even more noteworthy is the timeline behind the scenes. The Trump administration publicly called for at least 200 basis points of rate cuts this year, but the Fed’s projected easing capacity through 2025 is only 75 basis points. Powell has also stated that "unless inflation returns to the 2% target, policy will not change." While the president does not have the authority to directly remove the Fed Chair (the Federal Reserve Act of 1913 established a firewall), if it can be proven that Powell lied to Congress, it could serve as a criminal breach of duty, breaking through institutional barriers and laying the groundwork for further pressure.

How significant is the leverage to cut rates? The Treasury Department will need to roll over new debt over the next two years, replacing about $8 trillion in maturing bonds. Every 100 basis point decrease in interest rates could save the government roughly $80 billion annually. The Trump administration plans large-scale infrastructure investments and tax cuts, with the fiscal deficit expected to surpass $2 trillion, so reducing debt financing costs makes sense. But Powell remains committed to the inflation target, effectively constraining the White House’s liquidity expectations.

A finer detail: the Piro Office (newly appointed prosecutor Jenny Piro, who took office last November and approved the investigation within a month) is not only examining the budget but also reviewing all of Powell’s public speeches from last year, searching for inconsistent statements. Once a breakthrough is found, the playbook from Watergate could be replicated: initiate criminal charges → force congressional hearings → ultimately pressure the chairman to "voluntarily" resign early.

From Federal Reserve policy to global liquidity and the risk pricing of crypto assets, this series of events is reshaping market expectations. Investors need to pay attention not only to interest rates themselves but also to the asset allocation volatility driven by policy uncertainty.