For more, I'm joined by Janet Yellen.

She served as chair of the Federal Reserve Board from 2014 to 2018.

The current Fed chair, Jerome Powell, started his term immediately after her.

Most recently, she served as treasury secretary during the Biden administration.

Chair Yellen, welcome back to the NewsHour.

Thanks for joining us.

JANET YELLEN, Former U.S.

Treasury Secretary: Thank you so much.

Thanks for having me.

AMNA NAWAZ: So you said in an interview with The New York Times today that you believe the Department of Justice is being weaponized here, in your words, you said, to go after somebody that you don't have a valid basis to get rid of.

In your view, what is this investigation really about?

JANET YELLEN: Well, it's really about wanting to intimidate Fed leadership to be able to control monetary policy decisions, to bend monetary policy to the president's will.

He's been very openly critical really since his second term began of the Fed's policy decisions.

And he's indicated that he wants far lower interest rates than the Fed has regarded as reasonable to set, given that inflation is still significantly above the Fed's 2 percent target and the congressional mandate the Fed's been given to achieve price stability.

And the labor market, while it's shown some signs of weakening, is still -- the unemployment rate is very low, and it's still in good shape.

And President Trump has indicated that one of his goals is to lower the amount of interest that the government has to pay to finance roughly $38 trillion in outstanding federal debt.

Now, that is not one of the goals that Congress has assigned to the Federal Reserve.

And that's a very dangerous thing to hear a president say he thinks is an appropriate goal for monetary policy, because it's once central banks lose their independence and are forced to help governments finance deficits, that's when we see that's always a precondition for high and even hyper inflation.

AMNA NAWAZ: Can I just get your take on the context here of this moment, Chair Yellen?

Because it's been pointed out past presidents, Republican and Democrat, have pressured the Fed in different ways to lower interest rates.

Karoline Leavitt, I'm sure you saw earlier today, made the point that the president has a right to criticize Chair Powell and the policy of the Fed.

Why do you feel this is different in this moment?

JANET YELLEN: Well, he does have a right, although I don't think it's a wise thing to do.

And I think, during the Clinton administration, the Bush administration, Obama, Biden, the White House really was very careful not to comment on Fed policy and to support the Fed's independence, because it's better for the economy.

But the president has a right, of course, to criticize the Fed.

But President Trump has gone much further than that.

He's asserted that he has the right to remove one of the members of the Federal Reserve Board, Lisa Cook, for a cause.

And the Federal Reserve Act does allow the president to remove people for cause.

But this has never been done.

So it's very clear that he is trying to remove people whose views he disagrees with from the Federal Reserve Board to insert his own appointees.

AMNA NAWAZ: I saw it reported you called this now criminal probe that's been launched the most significant attack on the Fed's independence that we've seen.

And, specifically, we should point out that prosecutors are reportedly looking at Chair Powell's congressional testimony from last summer about that renovation project at the Fed's headquarters.

I just want to put to you what one Republican senator on the Banking Committee said That's Senator Cynthia Lummis.

And she said: "Whether Chair Powell was unprepared for his testimony or intentionally misled Congress about the Fed's extravagant spending, the American people deserve answers."

I guess my question to you is, what would you say to her and to others who say, let the process play out, let the facts fall where they may?

JANET YELLEN: Well, of course, Congress has oversight of the Fed, and they have every right to look into the building project and to demand answers and information.

And I believe the Fed has provided all of the information that has been requested about the project.

I will be very surprised if evidence emerges that Chair Powell was untruthful in his testimony, knowing him.

It is my guess that that is not the case.

AMNA NAWAZ: Chair Yellen, I've heard you say that all this could have an impact on the Fed's independence, that it is at risk.

I guess, are you looking at this now and thinking, has it already had an impact?

All of the president's political pressure, this criminal probe that's now been launched, from when you talk to people on the inside now, is it already having an impact on how they're doing their jobs?

JANET YELLEN: Well, I think it is placing a lot of pressure on Fed leadership.

When you think about speaking out about your views about the economy and monetary policy, and you know that, if you say something that displeases the president, that you may find yourself an object of a criminal probe by the Department of Justice, this is an atmosphere that is one of intimidation where people will feel pressured to do what the president wants in order to avoid harm both to the institution and to themselves personally.

And it may make people question whether or not they want to hold senior roles in the Federal Reserve if they're not going to be able to take the actions that they think are in the public mandate and accord with their congressional mandate.

AMNA NAWAZ: All right, that is the former Chair of the U.S.

Federal Reserve Board Janet Yellen joining us tonight.

Chair Yellen, thank you for your time.

It's good to speak with you.

JANET YELLEN: Thank you so much.