President Donald Trump has threatened to allow a “major lawsuit” against Federal Reserve Chairman Jerome Powell to proceed, escalating pressure on the central bank leader to cut interest rates.
The president said in a Truth Social post that the suit would relate to Powell’s management of pricey renovations at the Fed’s headquarters in Washington, D.C., which the president has previously criticized. Trump claimed that renovation costs have risen to $3.1 billion, compared to an initial estimate of $50 million.
Trump also accused Powell of being “too late” and said he must now lower interest rates. The president has been pressing the Fed to quickly slash interest rates by multiple percentage points, claiming it would save the US vast sums of money by reducing borrowing costs for government operations.
The Fed declined to comment on Trump’s post, while White House press secretary Karoline Leavitt stated that she wouldn’t discuss the potential lawsuit further. Powell and the Fed have previously defended the ongoing renovations, citing cost increases due to various factors.
In a recent congressional testimony, Powell said the Fed would have already cut rates if Trump hadn’t implemented his tariff policy. Traders expect a quarter-point rate reduction following the Federal Open Market Committee’s September meeting.
Source: https://www.cnbc.com/2025/08/12/trump-fed-powell-lawsuit-washington-building.html