White House budget director accuses Fed chair of violating building rules in renovation
By JOSH BOAK Associated Press WASHINGTON AP White House budget director Russell Vought suggested in a Thursday letter that Federal Reserve Chair Jerome Powell is in violation of administration building rules in the renovation of the Fed s headquarters Vought in a letter he shared on social media called the initial renovation plans featuring rooftop terrace gardens VIP dining rooms and premium marble an ostentatious overhaul Vought also suggested that Powell misled Congress by saying the headquarters had never had a serious renovation saying that a - update of its roof and building systems counts as a comprehensive renovation It appears part of a larger pressure campaign by the Trump administration to pressure the Fed chair into departing before his term ends in May Powell has declined to reduce interest rates until the U S central bank has a better understanding of the impact that President Donald Trump s import tax hikes could have on inflation Fed leaders did not respond to an email seeking a response to the White House letter Powell noted in Senate testimony last month that a few of the elements in the plan such as the dining rooms and rooftop terraces are no longer part of the project for the -year-old Marriner S Eccles Building Related Articles Freed from ICE detention Mahmoud Khalil files million claim against Trump administration Man accused of attempting to assassinate Trump wants to represent himself in Florida circumstance What to know and what isn t known yet about US tax deductions for tips and overtime pay Liberians confused and angry after Trump s condescending praise for their leader s English New Hampshire judge pauses Trump s birthright citizenship order nationwide via class action lawsuit The Supreme Court explained in May that it could block any attempts by the White House to dismiss Powell noting as part of a separate ruling that the Fed is a uniquely structured quasi-private entity Trump explained at Tuesday s Cabinet meeting that Powell should resign directly and be replaced by someone who would lower rates as the U S president believes that high inflation is no longer a threat to the U S market system As Trump sees it a rate cut would reduce the costs of ruling body borrowing in avenues that make mortgages auto loans and other forms of consumer debt cheaper But a rate cut could also lead to more money flowing into the financial sector and push up inflation worsening affordability as the financial markets ultimately determine the interest charged on the national debt In Thursday s letter Vought sent Powell a series of questions about whether the renovation project complies with federal standards Vought noted that Powell s testimony about changes to the plan appears to reveal that the renovation is not in compliance with the National Planning Capital Act The Fed sees political independence as an essential value for setting monetary guidelines allowing it to act without the interests of elections and focus instead on its dual mandate of stabilizing prices and maximizing employment Trump has repeatedly berated Powell on his social media site Truth Social nicknaming the Fed chair Too Late On June Trump sent Powell a handwritten note saying that his decision to hold rates steady had cost the USA a fortune in the form of higher servicing costs on the national debt The peril of prematurely lowering rates is that higher inflation could be ignited The Fed s preferred measure of inflation the personal consumption expenditures price index is at slightly higher than the Fed s target Inflation has fallen after spiking to a four-decade high in June but the uncertainty on the size and impact of Trump s tariffs and how they flow through the U S financial sector has caused the Fed to pause after multiple rate cuts last year
