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President Donald Trump will visit the Federal Reserve headquarters on Thursday, days after suggesting that Chair Jerome Powell’s management of a costly renovation project could be grounds for dismissal.
Trump has repeatedly criticized Powell for maintaining the Fed’s key short-term interest rate at 4.3 percent throughout the year.
The president has pushed for deeper rate cuts to stimulate the economy and lower borrowing costs for the federal government. Powell has held off on further reductions, citing the need to monitor the economic effects of Trump’s tariffs on foreign imports, which he warned could add to inflation.
The disagreement over interest rate policy has fueled months of tension between them, with Trump openly questioning Powell’s leadership. That tension escalated last week when Trump condemned a $2.5 billion renovation project at the Fed’s Washington headquarters and an adjacent building.
Originally estimated at $1.9 billion, the project’s cost has surged amid high construction material prices and extensive underground work. Trump blasted the spending as excessive and wasteful.
“When you spend $2.5 billion on, really, a renovation, I think it’s really disgraceful,” Trump said last week. Asked whether the project could justify removing Powell from office, he replied, “I think it is.”
Powell was appointed to lead the central bank by Trump in 2018 but has since drawn criticism from the president over his cautious approach to the economy. Under longstanding precedent, Federal Reserve leaders have operated independently from the White House.
In a Truth Social post last week, Trump accused Powell of “choking out the housing market” and labeled him “truly one of my worst appointments.” Trump also faulted former President Joe Biden for reappointing Powell in 2022.
“‘Too Late,’ and the Fed, are choking out the housing market with their high rate, making it difficult for people, especially the young, to buy a house. He is truly one of my worst appointments. Sleepy Joe saw how bad he was and reappointed him anyway – And the Fed Board has done nothing to stop this ‘numbskull’ from hurting so many people,” Trump wrote on Truth Social.
“In many ways the Board is equally to blame! The USA is Rockin’, there is VERY LOW INFLATION, and we deserve to be at 1%, saving One Trillion Dollars a year on Interest Costs. I can’t tell you how dumb Too Late is – So bad for our Country!” he continued.