Renovations at the Federal Reserve are set to get a probing today when a group of Trump allies make a visit to the central bank’s headquarters on the National Mall after weeks of mounting criticisms over the $2.5 billion renovation.
The high-profile construction site tour is also just one of numerous political pressure points being put before Chair Jerome Powell by President Trump’s team and his allies — even as the latest rhetoric from the president and Treasury Secretary Bessent have downplayed the chances of any imminent attempt to fire the central banker.
“In eight months, he’ll be out,” Trump noted on Tuesday, with Bessent adding Wednesday “we’re in no rush” to change leadership as both men also showed no signs of making Powell’s life simpler anytime soon.
In short, Powell’s job is looking slightly more secure this week — but the central bank chief’s problems clearly aren’t going away.
Up first is today’s visit from Trump allies, some of whom sit on the National Capital Planning Commission, which could go so far as attempting to stop ongoing construction pending further review.
Then in the coming weeks, Powell will wrestle with calls for an “exhaustive internal review” of how the Fed operates as well as pressure from Republicans on Capitol Hill that could ramp up in the fall.
There’s even a long-shot call for the Department of Justice to get involved and look at Powell personally.
And it comes as Powell is set to gather the Federal Open Market Committee (FOMC) next week for another interest rate decision that markets and many analysts say is pushing all of Trump’s actions as the president continues a daily pressure campaign to press the central banker and his colleagues to cut interest rates.
Read more: How the Fed rate decision affects your bank accounts, loans, credit cards, and investments
Up first: A high profile site tour
Up first is a tour of the Federal Reserve headquarters at the behest of Trump allies recently appointed to the National Capital Planning Commission (NCPC).
James Blair, one of Trump’s deputy chiefs of staff, is a new member of the NCPC and has leveled a series of attacks on Powell for weeks now over the building cost overruns, even charging at one point, “What do they not want us to see?”
The charges are ones that the central bank has repeatedly defended itself against, even going so far as publishing a page on its website devoted to the renovations, saying the increased costs came because of increased material cost and “unforeseen conditions” like asbestos, toxic contamination in the soil, and a higher-than-expected water table.
The costs of the project have grown from around $1.9 billion to $2.5 billion after the Fed submitted designs to the NCPC and received approval from that agency in 2020 and 2021.
The two buildings, Powell added in a recent note, were in need of “significant structural repairs” after they had not had a comprehensive renovation since they were built in the 1930s.
The changes, argue Trump allies like White House budget director Russell Vought, could mean the project is out of compliance with the approved plan — leading to a possible standoff as to whether the central bank needs to resubmit to the NCPC.
Powell is clearly looking to avoid that scenario, writing that the bank “does not regard any of these changes as warranting further review,” but White House officials are sending a different message.
“We want to see it for ourselves,” Blair recently told reporters, adding he is also looking to obtain “all of the revised plans since 2021.”
In addition to Blair and Vought, today’s tour is also expected to include Federal Housing Finance Agency Director Bill Pulte, who has emerged as another vocal Powell critic.
Pulte has even gone so far as to travel to the site already to film a video as he called the construction costs “very disturbing.”
Other key pressure points
This week’s site visit comes as Powell is also weathering an array of pressure points, with many lines of inquiry ongoing from Capitol Hill.
Rep. Dan Meuser of Pennsylvania is a subcommittee chair on the House Financial Services Committee and told Semafor this week that he is weighing a congressional investigation of the Fed — even as his Senate colleagues have shied away from that idea.
And Rep. Anna Paulina Luna of Florida, another Trump ally, even formally requested that the DOJ investigate Powell for perjury over comments in June around the renovations. That is seen as a long shot at best.
Perhaps more pressing is that House Speaker Mike Johnson said in an interview with Bloomberg reporters and editors this week that he is “disenchanted” with Powell and even open to modifying the 1913 act that created the Fed.
That would be a major change but is not expected to be before Congress in the near term, as the House of Representatives went home Wednesday evening for a recess that is scheduled to last for the rest of the summer.
Treasury Secretary Bessent has also called for an “exhaustive internal review” of the Fed, saying it could be Powell’s “legacy” as he accused the central bank of mission creep in its non-monetary policy activities.
Trump has signaled his support for the effort, and some observers say this could be the most consequential change — if the idea gains steam and looks to reshape how the central bank operates.
A recent note from Signum Global Advisors called this potentially “an even more holistic reshaping of the Fed than a ‘mere’ dismissal of Chair Jerome Powell,” adding it’s an effort that could extend even beyond the end of Powell’s chairmanship.
Ben Werschkul is a Washington correspondent for Yahoo Finance.
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