HOUSTON, United States

US Federal Reserve Chair Jerome Powell has said that he is facing a criminal investigation, but denied any wrongdoing, asserting the move is linked to political pressure over interest rate policy.

“This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings,” Powell said on Sunday in a video statement amid reports on the investigation over his congressional testimony on a $2.5 billion renovation of the central bank’s headquarters.

“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,” he said.

“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions, or whether instead monetary policy will be directed by political pressure or intimidation.”

US media reported earlier that the administration of President Donald Trump — who has frequently lambasted Powell over being “late” to lower interest rates — had opened a criminal investigation into Powell related to the renovation project and whether Powell misled Congress about its scope during testimony last June.

The US Attorney’s Office in Washington is examining whether Powell provided false statements to lawmakers, according to the reports.

Trump, a longtime critic of Fed chair

Powell has repeatedly clashed with Trump over interest rates, with the president publicly urging the Fed to sharply cut borrowing costs.

In an interview with NBC News on Sunday, Trump denied any involvement in the investigation.

“I don’t know anything about it, but he’s certainly not very good at the Fed, and he’s not very good at building buildings,” Trump said.

Asked whether he had pressured officials to pursue the case, Trump said: “No, I wouldn’t even think of doing it that way. What should pressure him is the fact that rates are far too high.”

Critics of the administration say that Trump has torn down the traditional wall of separation between the White House and the Justice Department and made it into a politicized tool.

Trump has also said that a lawsuit against Powell “for incompetence” in relation to the renovation was under consideration.

“It’s going to end up costing more than $4 billion,” Trump had said last month, adding that this would be the “highest price of construction per square foot in the history of the world.” Trump also said he would “love to fire” Powell.

The president, who has long said he wants to replace Powell as Fed chair, told The New York Times last week that his top economic adviser Kevin Hassett was a leading candidate for the job.

Powell’s term as chair ends in May, though his term as a Fed governor runs through January 2028. He has not said whether he plans to remain on the board after stepping down as chair.

In his statement, Powell said he respected the rule of law but warned against politicizing monetary policy.

“No one, certainly not the chair of the Federal Reserve, is above the law,” he said. “But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure.”

“In every case, I have carried out my duties without political fear or favor, focused solely on our mandate of price stability and maximum employment,” he said. “I will continue to do the job the Senate confirmed me to do.”

* With contributions by Mucahitan Avcioglu from Istanbul