What is the Powell DOJ subpoena about?

Powell said the Justice Department issued grand jury subpoenas tied to his June Senate testimony regarding building renovations. He warned that such actions can be seen as pressure on monetary policy. The legal process may take time, so investors should monitor official updates and the tone of future Fed communications.

Could the Powell DOJ subpoena change the rate cuts outlook?

It could, mainly through confidence effects. If the episode dents perceived independence, the Fed may communicate more cautiously, and markets may price slower easing. If independence appears intact and inflation cools further, the rate cuts outlook can normalize. Watch Fed messaging, CPI, labor data, and term premium moves.

How does this affect Hong Kong mortgage rates?

Hong Kong’s HKD is pegged to the USD, so HKMA policy and HIBOR track U.S. interest rates. If U.S. cuts are delayed, local floating mortgage costs can stay higher for longer. A smoother easing path would reduce funding pressure, supporting households and property developers with significant floating-rate exposure.

Did President Trump direct the subpoenas?

Trump denies involvement. The issue matters because political links, perceived or real, can affect how markets view Fed independence. Even without direct direction, the headlines can raise uncertainty for guidance and timing. Investors should rely on official statements and data, not speculation, when adjusting portfolios.

Law and Government

January 13: Powell DOJ Subpoena Tests Fed Independence, Rate Path

ByDanny Kontos January 13, 2026

On January 13, the Powell DOJ subpoena moved to center stage, putting Fed independence and the rate cuts outlook under a spotlight. Powell said the Justice Department issued grand jury subpoenas tied to his June Senate testimony on building renovations. Trump denies involvement. For Hong Kong, the path of U.S. rates steers HKMA moves, HIBOR, equity valuations, and property financing. We break down the risks, scenarios, and practical steps for HK investors watching global signals and local liquidity.