Former Federal Reserve Chair Janet Yellen has strongly criticized the investigation into her successor, Jerome Powell, saying it poses a serious threat to the independence of the U.S. central bank. Speaking on Monday, Yellen described the probe as “extremely chilling” and expressed surprise that financial markets have not reacted more strongly. The investigation, reportedly led by the U.S. attorney’s office in Washington, D.C., is examining whether Powell lied during congressional testimony last June regarding a costly renovation project at the Fed’s headquarters. The Justice Department has not confirmed the inquiry, which could involve perjury charges. “Knowing Powell as well as I do, the odds that he would have lied are zero,” Yellen said, suggesting the probe is politically motivated and intended to remove him from office. She warned that such actions could compromise the credibility and independence of monetary policy. Yellen also criticized political pressure on the Fed to cut interest rates to reduce federal debt payments, calling such interference “the road to a banana republic.” She emphasized that the Fed’s decisions should remain free from political influence. Other former Fed and Treasury officials have voiced similar concerns. Signatories including former Fed Chairs Ben Bernanke and Alan Greenspan, and former Treasury Secretaries Timothy Geithner and Henry Paulson, condemned the investigation as an unprecedented attack on central bank independence. They warned that undermining the Fed could have severe consequences for inflation and the U.S. economy. The Powell investigation comes amid broader political tensions over fiscal policy and the management of U.S. debt, raising alarm among economists and financial experts about the potential long-term effects on the central bank’s credibility.