Overview

• On Aug. 12 Trump posted that he may allow a “major lawsuit” against Jerome Powell for what he called grossly incompetent management of the Fed’s Washington headquarters renovation.
• The president revived his call for deep, immediate interest rate cuts—branding Powell “Too Late” for keeping the federal funds rate at 4.25%–4.50%.
• Federal Reserve records put the renovation cost at about $2.4–$2.5 billion, with officials attributing overruns to asbestos abatement, groundwater removal and historic-preservation requirements.
• The Office of Management and Budget and the Federal Housing Finance Agency have opened inquiries and the Fed’s inspector general will review the project, even as the White House vets potential successors to Powell.
• Legal experts note that under the Federal Reserve Act and a recent Supreme Court decision, the president cannot remove a Fed chair for policy disagreements without specific cause.