Overview

• President Donald Trump demanded that Fed Chair Jerome Powell slash interest rates “NOW” in a Truth Social post that also threatened a major lawsuit over the Fed’s headquarters overhaul.
• Karoline Leavitt said the administration is exploring legal options against Powell, marking an escalation from public criticism to formal legal threats.
• Fed documents and officials defend the project’s roughly $2.4 billion to $2.5 billion budget and attribute cost increases to rising labor and material expenses plus asbestos abatement.
• Legal experts note a Supreme Court ruling and statutory protections make it unlikely Trump could remove Powell for policy reasons, leaving lawsuits and oversight as the main tools to exert pressure.
• Fixed-income markets have reacted by pricing in a quarter-point rate cut at the Fed’s September FOMC meeting, reflecting elevated expectations for policy easing.