Overview

• President Trump is exploring the Federal Reserve’s $600 million renovation cost overrun as legal “cause” to justify firing Chair Jerome Powell.
• He has publicly denied that Treasury Secretary Scott Bessent urged him against an ouster and filed a defamation lawsuit against the Wall Street Journal over its reporting.
• White House insiders and lawmakers warn that any abrupt removal could breach the Federal Reserve Act’s ‘for cause’ removal protections and spark severe market turmoil.
• Treasury Secretary Scott Bessent called for a comprehensive institutional review of the Fed’s mission and performance on CNBC, challenging its inflation outlook and tariff assessments.
• Legal experts say the Fed Act lacks specific fireable offenses and Supreme Court signals favor central bank independence, making a successful challenge to Powell’s tenure unlikely.