The senator then laid down a clear ultimatum.
“I will oppose the confirmation of any nominee for the Fed — including the upcoming Fed Chair vacancy — until this legal matter is fully resolved.”
This is not an empty threat. Tillis sits on the Senate Banking Committee, giving him significant influence over who advances to lead the nation’s central bank. With Powell’s term as chair expiring in May, the timing could not be more critical. While Powell is expected to remain on the Federal Reserve’s board of governors until 2028, Trump has made it clear he wants new leadership at the top.
Photo: Gage Skidmore
The North Carolina Republican has increasingly positioned himself as a thorn in Trump’s side. Just days earlier, Tillis warned he would block all Department of Homeland Security nominees unless DHS Secretary Kristi Noem appears before the Senate Judiciary Committee.
The Department of Homeland Security quickly pushed back. A spokesperson told Fox News Digital that Noem had already testified recently and remains willing to work with lawmakers.
“Secretary Noem testified on Capitol Hill less than a month ago and remains committed to transparency and continued engagement with Congress,” the spokesperson said.
“While the Department does not currently have any nominees pending before the Senate, we hope senators will refrain from holding President Trump’s appointments in a way that could compromise our national security.”
The latest controversy stems from an investigation opened by the U.S. Attorney’s Office for the District of Columbia. Prosecutors are reviewing whether Powell misled lawmakers during testimony last June before the Senate Banking Committee regarding renovations to the Federal Reserve’s Washington headquarters. While the project is funded by the Federal Reserve itself, not taxpayers, it has become a political flashpoint amid rising tensions between Powell and Trump.
Powell responded forcefully, rejecting claims that the probe is about renovations or testimony.
“This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings,” Powell said in a video statement.
“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.”
“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.”
Democrats wasted no time joining the fight. Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, accused Trump of attempting to weaponize the Justice Department to control monetary policy.
“Trump is abusing the authorities of the Department of Justice like a wannabe dictator, so the Fed serves his interests, along with his billionaire friends,” Warren said in a statement.
“This Committee and the Senate should not move forward with any Trump nominee for the Fed, including Fed Chair.”
The Federal Reserve recently cut interest rates by 0.25 percent in December, marking its third consecutive reduction. Trump was unimpressed and publicly demanded more aggressive cuts to ease borrowing costs for Americans.
He has since doubled down, promising a new direction for the central bank.
“I’ll soon announce our next chairman of the Federal Reserve, someone who believes in lower interest rates, by a lot, and mortgage payments will be coming down even further,” Trump said.
As the battle lines harden, the standoff between Trump, Senate Republicans, and the Federal Reserve is shaping up to be one of the most consequential economic fights of the year. With interest rates, inflation, and economic growth hanging in the balance, Tillis’ rebellion could have ripple effects far beyond Capitol Hill.
