The Federal Reserve’s $2.5 billion office renovation in Washington, D.C., has become the latest battleground in a war of words between President Donald Trump and the central bank.
Trump’s administration is unhappy with the Fed’s decision not to lower interest rates more aggressively, and now they’re targeting the renovation costs as a way to make an example of Chairman Jerome Powell. The project’s cost has ballooned from $1.9 billion to $2.5 billion due to unexpected issues like excess lead and asbestos.
Fed officials say the real issue is inflation, which has raised building costs nationwide. However, Trump is unhappy with the current interest rates and claims they’re too high.
Powell defended the renovation, saying some of the most sensational claims are exaggerated. The Fed’s inspector general will review the project to address concerns about cost overruns.
The tension between the administration and the central bank reveals a deeper disagreement about the Fed’s role in controlling inflation. Trump wants lower interest rates, while Powell is trying to assess whether recent policies, including tariffs, will rekindle inflation.
Powell’s term as Fed chairman ends in ten months, giving Trump an opportunity to install a new leader who might be more malleable. The central bank is designed to remain independent, but if it starts taking orders from the White House, it could lose credibility and harm the economy.
Source: https://www.npr.org/2025/07/14/nx-s1-5467236/federal-reserve-trump-white-house-attacks-renovations-interest-rates