Updated @ 3:43 PM EDT on July 25, 2025
While touring the Federal Reserve’s ongoing renovations in Washington, D.C., on Thursday, President Trump engaged in an unusual verbal altercation with Fed Chair Jerome Powell regarding the project’s ultimate cost.
As the president tries to exert pressure on the Fed to reduce interest rates sooner, the costly refurbishment project has turned into a point of controversy. In recent years, the cost of the renovation has increased from $1.9 billion to $2.5 billion.
Along with Sen. Tim Scott, the Republican chairman of the Senate Banking Committee from South Carolina, Trump and Powell paused during the visit to speak to television cameras.
With a document in hand, Trump asserted that the expenses had now risen to $3.1 billion, to Powell’s obvious disapproval.
“So we’re taking a look, and it looks like it’s about 3.1 billion [dollars],” Trump stated. “Went up a little bit or a lot.”
In response, Powell disputed the president’s claim, saying, “I haven’t heard that from anybody at the Fed.”
After reviewing the document, the Fed chair stated that the extra expenses the president was mentioning were for a different building whose construction was finished five years prior.
Then, as reporters yelled questions at him, Trump became more accommodating.
“I’d rather not get personal. Regarding the improvements, Trump remarked, “I just want to see it get finished.” In many respects, it’s unfortunate that it began, but it did. Additionally, it has been in the process of being built for a long time.
Additionally, Trump seems to steer clear of his recent critiques on Powell.
“Well, I’d love him to lower interest rates, but other than that, what can I tell you?” Powell laughed as Trump spoke.
Trump later seeks to ease tensions
Later, in an attempt to defuse tensions from his previous appearance, Trump spoke to reporters once more, this time without Powell.
“I thought we had a good meeting,” Trump told reporters afterwards. No, there wasn’t any conflict. Tension was absent.
Trump had been hammering Powell nonstop in the lead-up to Thursday’s Fed visit, calling the Fed chair a “numbskull” and saying it was “too late” to lower interest rates.
Trump reiterated his request for lower borrowing prices during his second news conference on Thursday, despite claiming to feel “good” about his relationship with Powell.
“I believe that the chairman is going to do the right thing, maybe a little too late, as the expression goes, but I believe he’s going to do the right thing,” Trump stated.
An unusual visit in more ways than one
Since President George W. Bush attended the swearing-in of former Federal Reserve Chair Ben Bernanke in 2006, Trump’s visit is the first time a president has visited the Fed.
This is due to the Fed’s long-standing defense of its interest rate-setting independence, which is essential to maintaining the trust of international investors. Modern presidents have generally respected the Fed’s independence and avoided appearing to meddle in its choices.
This year, the Fed has kept interest rates unchanged, largely due to worries that the president’s tariffs would cause inflation to rise. According to the most recent data, consumer prices increased 2.7% from a year ago, quicker than they did the month before.
Despite Trump’s push, it is unlikely that the Fed will lower rates at its upcoming policy meeting later this month due to that spike.
Trump has threatened to fire Powell
When Trump threatened to fire Powell last week, his resentment erupted. He later changed his mind without completely ruling it out.
Powell has previously stated that he plans to finish his tenure as Fed chair, which ends in May of next year, but the Fed has not yet responded to Trump’s criticism. When asked if he would step down if Trump asked him to last year, Powell gave a resounding “No.”
A major court battle and financial market turmoil would probably result from an attempt to oust Powell. According to legal experts, a Fed chair may only be removed “for cause,” like breaching the law.
Although legal analysts have stated that such an argument is unlikely to pass legal scrutiny, the Trump administration’s attacks against the Fed reconstruction project are perceived as another means of increasing pressure on Powell and possibly as a justification to terminate him.
In the past, the Fed chair has fought back, citing inflation, which has increased the cost of construction projects across the country, and lead and asbestos mitigations as reasons for the cost overruns.
Copyright 2025 NPR
