In a rare presidential visit to the Federal Reserve head office, president Donald Trump publicly pressed Fed Chair Jerome Powell To deliver competitive interest rates and at the same time criticize the renovation project of $ 2.5 billion from the central bank.
What happened: On Thursday, Trump again insisted on a rate reduction and said, “I would love to lower it”, while he was standing next to Powell during a tour of the Fed headquarters, which is currently being renovated, according to a report from Reuters.
This visit comes only a few days before the meeting of the FED rate, whereby the 19 policy makers of the Central Bank are generally expected to keep the interest rates in the benchmark unchanged, in the range of 4.25% to 4.50%.
See also: Federal Reserve rates ‘justified’ despite being highest among G-10 colleagues, says LPL Economist as Trump that puts Jerome Powell under pressure to leave
Tensions flared up during the visit when Trump expressed concern about the enormous renovation costs of the FED, which he says it was blown up to $ 3.1 billion.
Powell replied and said, “I am not aware of that,” and when he had a piece of paper from Trump left over the same thing, he said, “You just added a third building,” referring to the Martin building that was completed five years ago.
In a truth of the truth later in the day, Trump commented on the renovation and said: “It is what it is and hopefully it will be completed as soon as possible.” He adds that the cost overruns have been ‘substantial’, but on the ‘positive side’, he notes: “Our country is doing very well and can almost afford it.”
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Despite the increasing tensions, Trump told reporters after his visit that he does not intend to dismiss Powell, something that he has repeatedly threatened in the past. “This is a big step and I just don’t think it’s necessary,” he said.
Why it matters: The increasing renovation costs of the FED were criticized by the Office of Management and Budget Director Russell VoughtWho said a week ago that “the Palace of Versailles would have cost $ 3 billion in today’s dollars”, which emphasizes the extravagance of the project.
Powell has since defended the renovation of the FED in a letter to Vought and says that the project “tackles” important structural repairs “and” to “make the buildings safe, healthy and effective places to work.”
Speculation has been multiple that Trump could use the cost overruns as a reason for the end of Powell ‘for cause’, after months of escalating tensions and public criticism.
Photo with thanks to: Miss.cabul from Shutterstock
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