Powell investigation: Drumbeat of Republican opposition grows on Capitol Hill

Republican protests are growing louder on Capitol Hill as the Trump administration’s Department of Justice pursues a criminal investigation into Federal Reserve Chair Jerome Powell.

Powell on Sunday night revealed that the Justice Department opened an investigation into his handling of renovations to the central bank’s headquarters and his testimony about the matter to Congress. Powell said the investigation was an attempt to intimidate him as he lowers interest rates at a slower pace than President Donald Trump desires.

The GOP resistance could derail his eventual pick to succeed Powell when the Fed chief’s term is up in May, as North Carolina Republican Sen. Thom Tillis, a member of the Senate Banking Committee, threatens to block any nominee to the central bank until the investigation is resolved. Tillis’ comments are now being echoed by other Republicans.

Sen. Lisa Murkowski, R-Alaska, wrote in a post on X, that the “administration’s investigation is nothing more than an attempt at coercion,” and called for a congressional investigation into the matter.

“If the Department of Justice believes an investigation into Chair Powell is warranted based on project cost overruns—which are not unusual—then Congress needs to investigate the Department of Justice,” Murkowski said. “The stakes are too high to look the other way: if the Federal Reserve loses its independence, the stability of our markets and the broader economy will suffer. My colleague, Senator Tillis, is right in blocking any Federal Reserve nominees until this is resolved.”

Tillis’ block is a massive problem for Trump, who has long sought to oust Powell and replace him with an ally. The Banking Committee is comprised of 13 Republicans and 11 Democrats, meaning one Republican defection can cause a deadlock and block a nominee from advancing.

Trump has repeatedly said he plans to replace Powell when his term as Fed chair is up in May. However, Powell could stay on as a governor until 2028.

And the chorus of Republicans criticizing the administration over the investigation is only getting louder.

“Pursuing criminal charges relating to his testimony on building renovations at a time when the nation’s economy requires focus and creates an unnecessary distraction,” said House Financial Services Chair French Hill, a Republican of Arkansas.

“The Federal Reserve is led by strong, capable individuals appointed by President Trump, and this action could undermine this and future Administrations’ ability to make sound monetary policy decisions,” he said.

Even Sen. Kevin Cramer, R-N.D., a Banking Committee member who is a frequent Powell critic, criticized the investigation.

“Jerome Powell is a bad Fed Chair who has been elusive with Congress, especially regarding the overruns of the elaborate renovations of the building,” Cramer said. “I do not believe however, he is a criminal. I hope this criminal investigation can be put to rest quickly, along with the remainder of Jerome Powell’s term. We need to restore confidence in the Fed.”

CNBC has reached out to Senate Banking Committee Chair Tim Scott, R-S.C., for comment on the investigation into Powell.

Trump does have one ally, however, in his administration’s push to investigate Powell: Sen Cynthia Lummis, R-Wyo.

“Whether Chairman Powell was unprepared for his testimony or intentionally misled Congress about the Fed’s extravagant spending, the American people deserve answers. I will wait for the DOJ to release its findings before commenting further,” Lummis said.

CNBC has reached out to the White House for a response to the members’ complaints.

This story is developing. Please check back for updates.