Overview

• In a Truth Social post on Aug. 12, Trump wrote “Jerome ‘Too Late’ Powell must NOW lower the rate” and said he was “considering allowing a major lawsuit” over the Fed’s renovation costs.
• Jerome Powell and Fed officials argue the $2.5 billion project is necessary for structural repairs, safety upgrades and code compliance, dismissing Trump’s $3 billion figure as including pre-existing work.
• Legal experts and a recent Supreme Court ruling confirm the president cannot remove the Fed chair for policy disagreements, constraining any attempt to oust Powell.
• Treasury Secretary Scott Bessent is leading a broad search for Powell’s successor, interviewing vice chairs Michelle Bowman and Philip Jefferson, Dallas Fed President Lorie Logan and others, with prediction markets favoring Christopher Waller.
• Softer labor data and a July 2.7% CPI reading have pushed fixed-income traders to price in a quarter-point Fed rate cut at the September FOMC meeting.