Powell defends Fed renovation project in letter to White House
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The Federal Reserve building under construction in Washington, D..C. Photo: Michael M. Santiago/Getty Images
Federal Reserve chair Jerome Powell responded to a pointed letter from the Trump administration on Thursday, offering the central bank's strongest defense to date in attacks over its building renovations.
Why it matters: The letter comes as President Trump denies he will attempt to fire Powell.
Details: In the letter, Powell says that the central bank followed proper protocol in a massive $2.5 billion overhaul of its headquarters — making comments similar to those posted on the Fed website earlier this week.
- Russell Vought, the director of the White House Office of Management and Budget, had requested answers about the project's cost overruns by the end of this week.
- Vought sent Powell a letter asking whether the Fed's renovations were out of step with plans approved by the National Capital Planning Commission (NCPC) in 2021 — and thus a violation of a law governing National Mall construction.
What they're saying: "Since the project started, the Board has enjoyed a constructive, collaborative, and fruitful engagement with the NCPC," Powell says in the letter published on Wednesday.
- "Although the Board is not generally subject to the direction of NCPC with respect to its building projects, we voluntarily collaborated with the NCPC and benefitted from robust and collaborative engagement with the commission in earlier stages of the project," he added.
The intrigue: Rep. Anna Paulina Luna (R-Fla.) said Thursday she would refer Powell to the Justice Department for possible criminal charges over his testimony to Congress about the renovation project.
- That echoes other figures close to Trump who've also suggested Powell lied to Congress.
The bottom line: The White House, which has pressured the Fed to lower interest rates, appears to be crafting a case to try to fire Powell for cause. Several officials — including Trump himself — have said it could be a fireable offense.
- But after whipsawing markets on Wednesday, Trump said it was "highly unlikely" that he would attempt to fire Powell.
Editor's note: This story has been updated with comments by Rep. Luna.
