Trump’s economic adviser expects there is ‘nothing to see’ as justice department investigates Fed

Donald Trump’s top economic adviser, Kevin Hassett, said he expected there was “nothing to see here” as the US Department of Justice pursues its criminal investigation of Jerome Powell, the Federal Reserve chair.

The Trump administration has faced a chorus of criticism in recent days after it emerged that the justice department had served the Fed with grand jury subpoenas, in a significant escalation of its extraordinary attack on the US central bank’s independence.

Allies of Trump spent months last year accusing the Fed of mishandling the multibillion-dollar renovations of its historic headquarters in Washington. Trump had repeatedly threatened legal action.

The justice department is now investigating the project, and whether Powell – who accused the administration of targeting him because the Fed has defied Trump’s repeated demands for drastic interest rate cuts – lied to Congress about its scope during testimony last summer.

Jeanine Pirro, US attorney for the District of Columbia, has insisted her office takes decisions “based on the merits”. Trump claimed he did not know about the investigation before it was reported.

Hassett, chair of Trump’s national economic council – and one of the US president’s top candidates to replace Powell as Fed chair, when his term expires in May – suggested on Friday morning that he believed Powell had told the truth about the renovation.

In an interview with the Fox Business Network, Hassett said that he wished the Fed had been “more transparent” when it comes to Powell’s congressional testimony about the ongoing renovations to the central bank that are at the heart of the investigation.

“All corners of government – the Fed, the White House, everything – we have a responsibility to the American people to be transparent,” said Hassett. “And I think that, if I were Fed chair, that I would insist on transparency. I probably would’ve answered the questions right away.

“But the bottom line is, I expect – Jay’s a good man – I expect that there’s nothing to see here, that the cost overruns were related to things like asbestos, as he says. But I sure wish that they had been more transparent.”

Every living former Fed chair condemned the investigation this week, warning that similar prosecutorial attacks in other countries had led to “highly negative consequences” for the cost of living – and argued they had “no place” in the US. Central banks around the world also issued a rare joint statement offering “full solidarity” to Powell.

Hassett said that, if offered the job as Fed chair, he would take the job with a commitment to “independence and transparency”.

“I think that’s something the Fed could have done better in the past,” he added.