Trump Presses Powell To Quit After Fed Renovation Review

A Federal Reserve inspector general’s review found no administrative misconduct and no evidence that federal criminal law was violated during the central bank’s approximately $2.5 billion headquarters renovation in Washington, D.C. The review found that the Fed’s Board of Governors did not manage the renovation contract effectively.

The watchdog attributed cost increases to inflation, limited competition among subcontractors, major design changes and difficult construction-site conditions. The project is now expected to be completed in 2027, about three years later than originally scheduled.

Trump rejected the findings in a post Wednesday and called for Powell to resign from the Fed’s Board of Governors. Trump blamed Powell for the renovation’s cost overruns and wrote that Powell should face a lawsuit from the U.S. government if he does not leave.

“If he doesn’t resign, he should be sued, at the highest level, by the United States Government, for either corruption or incompetence, both of which are completely unacceptable,” Trump wrote.

Powell’s term as Fed chair ended in May, and Kevin Warsh now holds the position. Powell remains a member of the Board of Governors because his separate term as a governor runs through January 2028.

Federal Reserve governors generally cannot be removed because a president disagrees with their interest-rate decisions. The Federal Reserve Act allows removal “for cause,” a standard intended to protect monetary-policy decisions from political pressure.

The dispute follows a Justice Department investigation into the renovation. A federal judge blocked subpoenas related to the investigation, citing insufficient evidence. Sen. Thom Tillis later delayed Warsh’s confirmation vote until the investigation into Powell was dropped. The Justice Department abandoned the criminal inquiry and referred the matter to the Fed’s inspector general.

The dispute has kept attention on the limits of presidential authority over the central bank. In a Supreme Court case involving Fed Governor Lisa Cook and presidential removal powers, Chief Justice John Roberts wrote that the Fed’s independence allows it to focus on stable prices and long-term growth rather than “ephemeral short-term gains.”

Interest-rate expectations and financial-market liquidity are among the factors that influence Bitcoin prices. Changes in expectations about the Fed’s independence could affect Bitcoin and other risk assets, even without an immediate change in monetary policy.