Overview

• Trump’s administration has launched an inquiry into a $2.5 billion Fed headquarters renovation as potential grounds to challenge Chair Jerome Powell’s leadership.
• Powell asked the Fed’s inspector general to review the renovation project after White House scrutiny of alleged cost overruns.
• The Federal Reserve held its benchmark rate at 4.25–4.5% in June and minutes show few policymakers endorse cuts at the July meeting.
• Investors have repositioned portfolios to guard against higher inflation and steeper yield curves if the central bank’s independence erodes.
• Business leaders, including JPMorgan’s Jamie Dimon, warn that politicizing the Fed could weaken the dollar, drive up borrowing costs and undermine market confidence.