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Powell Probe Sparks Market Turmoil & Precious Metals Surge
BraVoCycles Newsletter
January 12, 2026
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Over the weekend and into Monday (January 12, 2026), financial markets had a knee-jerk reaction to news of a Department of Justice criminal investigation into Federal Reserve Chair Jerome Powell. The probe centers on his June 2025 congressional testimony regarding the Fed's multi-billion-dollar headquarters renovation project, which was originally estimated at a lower cost but reportedly totaled around $2.5 billion.
Powell addressed the subpoenas in a rare Sunday video statement, calling the investigation "unprecedented". He emphasized that the Fed had been transparent with Congress and insisted the probe threatens central bank autonomy.
Market reaction (Sunday night → Monday):
U.S. stock futures sold off sharply overnight.
The U.S. dollar weakened.
Safe-haven assets surged: Gold broke to a fresh all-time high above $4,600/oz, while silver pushed into record territory around $85–$86/oz.
However, stocks showed intraday resilience, rallying off session lows to trade little changed or modestly mixed by late morning/early afternoon. This suggests the market is pricing in a high probability that the DOJ case ultimately fails or is politically motivated rather than substantive.
Markets remain on edge with risk-off sentiment lingering amid fears over Fed independence.
Stay tuned for updates.
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