During a rare visit to the Federal Reserve on Thursday, President Donald Trump engaged in a heated exchange with Federal Reserve Chairman Jerome Powell, criticizing the high costs of renovating two historic buildings at the central bank and calling for interest rate reductions.
At the conclusion of his visit, Trump stated he does not plan to dismiss Powell, contradicting his previous statements. He told reporters afterward, “That would be a big step and I don’t think it’s necessary.” Trump mentioned that the renovation costs exceed three billion dollars, a claim Powell disputed during the tour, prompting Trump to present a document to support his assertion, despite Powell’s refusal to acknowledge it.
When Trump asserted that the building costs were around three billion, Powell replied, “I’m not aware of that.” In response, Trump, seemingly prepared for this discussion, produced a paper from his pocket, stating, “It just came out.” Powell corrected him, indicating that Trump had mistakenly included a third building that does not exist. However, Trump insisted that the third building is under construction, to which Powell responded by clarifying that the mentioned third structure, not undergoing renovation, was built five years ago.
Reports last week indicated that Powell had reconsidered continuing the ambitious renovation project of the Federal Reserve building in Washington, which has drawn criticism from opponents who label it the “Versailles Palace.”
Powell has requested the Federal Reserve’s inspector general to review the $2.5 billion renovation project—a focal point for increasing attacks from the Trump administration.
A source familiar with the matter revealed to Axios that Powell directed Inspector General Michael Horowitz to examine the project costs and any other related issues he deems pertinent.
The Trump administration has targeted the lavish renovation project—alongside allegations that Powell misled a Senate committee regarding the planned luxurious amenities—as part of a broader campaign to pressure Powell, who has consistently rejected Trump’s calls for interest rate cuts.
Over the weekend, White House economic advisor Kevin Hassett commented that Trump has the authority to remove Powell for any reason, should evidence support such a decision, adding that the Fed chairman “has a lot to answer for” regarding the excessive renovation costs at the Washington headquarters.
In late April, The Washington Post was the first to report that the Federal Reserve was proceeding with extensive renovation works as part of a $2.5 billion overhaul of the Mariner S. Eccles Federal Reserve building located at the corner of 20th Street and Constitution Avenue—despite the project exceeding its budget by over $700 million.