Powell letter addresses White House criticism of Fed renovations

Federal Reserve Chair Jerome Powell in a Thursday letter countered criticisms leveled at the central bank by a top White House official over a $2.5 billion renovation project.

“We take seriously the responsibility to be good stewards of public resources as we fulfill the duties given to us by Congress on behalf of the American people,” Powell wrote in a letter addressed to Russ Vought, director of the White House Office of Management and Budget.

Powell’s letter, which largely repeated information available on a new “Frequently Asked Questions” page on the Fed’s website about the construction project, was in response to correspondence from Vought on July 10.

In that letter, Vought characterised the renovation as an “ostentatious overhaul” and criticised the project’s costs, while asking Powell to provide details about the renovation within seven business days.

At issue is the Fed’s renovation of two historic buildings at its headquarters in Washington. Trump, Vought and other allies of the president have seized on the project’s increased costs and Powell’s recent congressional testimony about the renovation to intensify scrutiny of Powell in recent weeks.

The criticisms over the construction have coincided with a continued push from Trump and administration officials for the Fed to lower interest rates. Fed policymakers have held rates steady so far this year, as they wait for more information on how Trump’s policies on tariffs and other economic issues will affect inflation and the labour market. That on-hold stance has provoked Trump’s ire towards Powell, with the president frequently insulting the Fed chair.

After a speech in New York Thursday, Fed Governor Christopher Waller blamed part of the cost overrun on inflation.

“Any construction project I’ve ever heard, this is a common — I mean, I’m not defending it — but this is not an uncommon thing,” he said. “And we had inflation much higher than anybody was bidding out in 2017. So, that’s clearly a factor.”

Republican Representative Anna Paulina Luna of Florida said Thursday in a post on X that she is “criminally referring” Powell to the Justice Department to “investigate perjury” regarding the renovations. Such referrals by lawmakers are not legally binding.

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