In a rare Presidential visit to the Federal Reserve headquarters, President Donald Trump publicly pressed Fed Chair Jerome Powell to deliver sharp interest rate cuts while criticizing the central bank's $2.5 billion renovation project.
What Happened: On Thursday, Trump once again pushed for a rate cut, saying, “I’d love him to lower interest rates,” while standing next to Powell during a tour of the Fed’s headquarters, which is currently under renovation, according to a Reuters report.
This visit comes just days before the Fed's rate-setting committee meeting, where the central bank’s 19 policy-makers are widely expected to hold benchmark interest rates unchanged, in the 4.25% to 4.50% range.
Tensions flared during the visit when Trump raised concerns regarding the Fed’s massive renovation costs, which he says have ballooned to $3.1 billion.
Powell responded, saying, “I’m not aware of that,” and when handed a piece of paper by Trump regarding the same, he said, “You just added in a third building,” referring to the Martin Building that was completed five years ago.
In a Truth Social post later in the day, Trump commented on the renovation, saying, “It is what it is and, hopefully, it will be finished ASAP.” He adds that the cost overruns have been “substantial,” but on the “positive side,” he notes, “our Country is doing very well and can afford just about anything.”
Despite mounting tensions, Trump told reporters after his visit that he does not intend to fire Powell, something that he has repeatedly threatened in the past. “To do so is a big move and I just don’t think it’s necessary,” he said.
Why It Matters: The Fed’s mounting renovation costs were criticized by the Office of Management and Budget Director Russell Vought, who said a week ago that “the Palace of Versailles would have cost $3 billion in today’s dollars,” highlighting the extravagance of the project.
Powell has since defended the Fed’s renovation in a letter to Vought, saying that the project addresses “significant structural repairs” and updates “to make the buildings safe, healthy, and effective places to work.”
Speculation has been rife that Trump might use the cost overruns as grounds for terminating Powell “for cause,” following months of escalating tensions and public criticism.
Photo Courtesy: miss.cabul from Shutterstock
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