Latest news with #US2.5
ABC News
4 days ago
- Business
- ABC News
Donald Trump fact-checked by Federal Reserve boss Jerome Powell in exchange over renovations
After months of criticising US Federal Reserve chair Jerome Powell, President Donald Trump took the fight to his front door, publicly scorning the central bank chief over the ballooning costs of a long-planned building project. Mr Powell pushed back, challenging the president's latest price tag as incorrect. Wearing hard hats and grim faces, standing in the middle of the construction project, Mr Trump and Mr Powell addressed the TV cameras. Mr Trump charged that the renovation would cost $US3.1 billion ($4.7 billion), much higher than the Fed's $US2.5 billion figure. Mr Powell, standing next to him, shook his head. The Fed chair, after looking at a paper presented to him by Mr Trump, said the president was including the cost of renovating a separate Fed building, known as the Martin building, that was finished five years ago. The rare presidential visit represented a significant ratcheting up of the president's pressure on Mr Powell to lower borrowing costs, which Mr Trump says would accelerate economic growth and reduce the government's interest payments. "We have to get the interest rates down," Mr Trump told reporters away from Mr Powell. However, Mr Powell and other officials have signalled they will likely keep their key rate unchanged at about 4.3 per cent, but may start cutting rates in September. The Federal Reserve sets a short-term interest rate that influences other borrowing costs, but it does not directly control those other rates. Asked if the rising costs of the Fed's renovation, estimated in 2022 to cost $US1.9 billion ($2.89 billion), were a "fireable offence," Mr Trump said: "I don't want to put this in that category." "To do that is a big move, and I don't think that's necessary," Mr Trump added. "I just want to see one thing happen, very simple: Interest rates come down." On Truth Social, Mr Trump said: "The cost overruns are substantial but, on the positive side, our Country is doing very well and can afford just about anything — Even the cost of this building!" Live updates: Trump clashes with US Fed Chair Mr Trump may be able to remove Mr Powell by accusing him of mismanaging the bank's renovation project. The push comes after a months-long campaign by Mr Trump to try to rid himself of the politically independent central banker, who has resisted the Republican president's calls to slash interest rates out of concerns about the administration's tariffs sparking higher levels of inflation. The Supreme Court recently signalled that Mr Trump could not fire Mr Powell simply because the president disagreed with him on interest rates. But legally, he could do so "for cause", such as misconduct or dereliction of duty. Mr Trump has seized on that provision, indicating that Mr Powell's handling of an extensive renovation project on two buildings in Washington could be grounds to take the unprecedented and possibly legally dubious step of firing him. The project has been underway for years, going back to Mr Trump's first term. But it only recently caught the White House's attention. The Fed chair has been an obstacle in Mr Trump's efforts to gain total control over the executive branch. Mr Powell and his board have the dual mandate of maximising employment and keeping prices stable, a task that can require them to make politically unpopular moves such as raising interest rates to hold inflation in check. The general theory is that keeping the Fed free from the influence of the White House — other than for nominations of Fed officials — allows it to fulfil its mission based on what the economy needs, instead of what a politician wants. An attempt to remove Mr Powell from his job before his term ends would undercut the Fed's longstanding independence from day-to-day politics and could lead to higher inflation, higher interest rates and a weaker economy. The Fed says its main headquarters, known as the Marriner S Eccles Building, was in dire need of an upgrade because its electrical, plumbing and air conditioning systems, among others, are nearly obsolete and some date back to the building's construction in the 1930s. The renovation will also remove asbestos, lead and other hazardous elements and update the building with modern electrical and communications systems. The Fed says there has been periodic maintenance to the structures but adds this is the first "comprehensive renovation". Trump administration officials have criticised the Fed over the project's expense, which has reached $US2.5 billion ($3.8 billion), about $600 million more than was originally budgeted. Russ Vought, the administration's top budget adviser, wrote Mr Powell a letter that said Mr Trump was "extremely troubled" about the Fed's "ostentatious overhaul" of its facilities. The Fed says the renovations will reduce costs "over time" because it will be able to consolidate its roughly 3,000 Washington-based employees into fewer buildings and will no longer need to rent as much extra space as it does now. The Fed's changes to its building plans have opened it up to another line of attack: White House officials have suggested the Fed violated the terms of the approval it received from a local planning commission by changing its plans. In its September 2021 approval of the project, the National Capital Planning Commission said it "Commends" the Fed for "fully engaging partner federal agencies". But because the Fed changed its plans, the administration has indicated it needed to go back to the commission for a separate approval. Essentially, White House officials are saying Mr Powell is being reckless with taxpayer money because of the cost of the renovation, but they are also accusing him of acting unethically by scaling back the project to save money. James Blair, the White House deputy chief of staff whom Mr Trump named to the commission, said in a post on X that Mr Powell's June congressional testimony "leads me to conclude the project is not in alignment with plans submitted to & approved by the National Capital Planning Commission in 2021". Mr Blair said he intended to review materials from the Fed on how the approved 2021 renovation plans had changed and circulate a letter among his colleagues on the commission that would go to Fed officials. AP
Sydney Morning Herald
4 days ago
- Business
- Sydney Morning Herald
Federal Reserve chief schools Trump in excruciating live fact-check
The figures are eye-watering. What started as a $US1.9 billion ($2.9 billion) project in 2023 has blown out to about $US2.5 billion – although, in percentage terms, that's nowhere near as bad as our very own beleaguered North Sydney Olympic Pool. The expensive reno involves two grand Washington buildings, constructed in the 1930s, and is scheduled for completion in 2027. By then, Powell will no longer be the Fed chair – his term finishes in May. Taking their tour, Trump and Powell stood beside each other in matching white hard hats, in what looked like a deleted scene from The Odd Couple. 'It looks like it's about $US3.1 billion. It went up a little bit. Or a lot,' Trump said of the renovation cost. Powell, who had been staring grimly at the floor, turned to the president and began shaking his head. 'I'm not aware of that,' the banker said. 'It just came out,' Trump replied. Powell added: 'I haven't heard that from anybody at the Fed.' Turns out the figure 'just came out' of Trump's jacket pocket, from which the president withdrew a document that Powell then inspected, quizzically, after donning his glasses. It took him just a few seconds to realise the ruse – Trump was trying to conflate two separate projects. Loading 'Oh, you're including the Martin renovation,' Powell said, referring to the refurbishment of another building, which was completed in 2021. 'You just added in a third building, is what that is.' 'It's a building that's being built,' Trump said. 'No, it was built five years ago,' Powell corrected. 'We finished Martin five years ago … it's not new.' Unfazed, Trump turned it over to questions. Asked by a reporter what he, as a real estate developer, would do with a project manager who presided over such budget blowouts, Trump adopted his trademark phrase (and tone) from his days on reality TV show The Apprentice. 'I'd fire 'em,' he said. Asked whether there was anything Powell could say to him that would cause him to back off from his personal attacks, Trump said: 'I'd love him to lower interest rates', and then slapped the bank chairman on the back. And, in an audacious display from someone who has spent weeks calling him every name in the book, Trump batted away suggestions that he might try to fire Powell. 'I don't want to be personal,' he said.
The Age
4 days ago
- Business
- The Age
Federal Reserve chief schools Trump in excruciating live fact-check
The figures are eye-watering. What started as a $US1.9 billion ($2.9 billion) project in 2023 has blown out to about $US2.5 billion – although, in percentage terms, that's nowhere near as bad as our very own beleaguered North Sydney Olympic Pool. The expensive reno involves two grand Washington buildings, constructed in the 1930s, and is scheduled for completion in 2027. By then, Powell will no longer be the Fed chair – his term finishes in May. Taking their tour, Trump and Powell stood beside each other in matching white hard hats, in what looked like a deleted scene from The Odd Couple. 'It looks like it's about $US3.1 billion. It went up a little bit. Or a lot,' Trump said of the renovation cost. Powell, who had been staring grimly at the floor, turned to the president and began shaking his head. 'I'm not aware of that,' the banker said. 'It just came out,' Trump replied. Powell added: 'I haven't heard that from anybody at the Fed.' Turns out the figure 'just came out' of Trump's jacket pocket, from which the president withdrew a document that Powell then inspected, quizzically, after donning his glasses. It took him just a few seconds to realise the ruse – Trump was trying to conflate two separate projects. Loading 'Oh, you're including the Martin renovation,' Powell said, referring to the refurbishment of another building, which was completed in 2021. 'You just added in a third building, is what that is.' 'It's a building that's being built,' Trump said. 'No, it was built five years ago,' Powell corrected. 'We finished Martin five years ago … it's not new.' Unfazed, Trump turned it over to questions. Asked by a reporter what he, as a real estate developer, would do with a project manager who presided over such budget blowouts, Trump adopted his trademark phrase (and tone) from his days on reality TV show The Apprentice. 'I'd fire 'em,' he said. Asked whether there was anything Powell could say to him that would cause him to back off from his personal attacks, Trump said: 'I'd love him to lower interest rates', and then slapped the bank chairman on the back. And, in an audacious display from someone who has spent weeks calling him every name in the book, Trump batted away suggestions that he might try to fire Powell. 'I don't want to be personal,' he said.
Yahoo
4 days ago
- Business
- Yahoo
Trump to check out Federal Reserve's pricey renovations
The Federal Reserve, known for its tight lips, structured formality and extraordinary power to shape the global economy, finds itself putting out the welcome mat for President Donald Trump. Trump and his allies say a $US2.5 billion ($A3.8 billion) renovation of the Fed headquarters and a neighbouring building reflects an institution run amok — a belief they hope to verify in a Thursday afternoon tour of the construction site. The Fed allowed reporters to tour the building before the visit by Trump, who in his real estate career, has bragged about his lavish spending on architectural accoutrements that gave a Versailles-like golden flair to his buildings. The visit is an attempt to further ratchet up pressure on Fed Chair Jerome Powell, whom the Republican president has relentlessly attacked for not cutting borrowing costs. Trump's attacks have put the Fed, a historically independent institution, under a harsh spotlight. Undermining its independence could reduce the Fed's ability to calm financial markets and stabilise the US economy. "This stubborn guy at the Fed just doesn't get it — Never did, and never will," Trump said Wednesday on Truth Social. "The Board should act, but they don't have the Courage to do so!" On Thursday, reporters wound through cement mixers, front loaders, and plastic pipes as they got a close-up view of the active construction site that encompasses the Fed's historic headquarters, known as the Marriner S Eccles building, and a second building across 20th Street in Washington. Fed staff pointed out new blast-resistant windows and seismic walls that were needed to comply with modern building codes and security standards set out by the Department of Homeland Security. The Fed has to build with the highest level of security in mind, Fed staff said, including something called "progressive collapse," in which only parts of the building would fall if hit with explosives. Sensitivity to the president's pending visit among Fed staff was high during the tour. Reporters were ushered into a small room outside the Fed's boardroom, where 19 officials meet eight times a year to decide whether to change short-term interest rates. The room, which will have a security booth, is oval-shaped, and someone had written "Oval Office" on plywood walls. The Fed staff downplayed the inscription as a joke. When reporters returned through the room later, it had been painted over. Plans for the renovation were first approved by the Fed's governing board in 2017. Fed staff also said tariffs and inflationary increases in building material costs also drove up costs. Trump in 2018 imposed a 25 per cent duty on steel and 10 per cent on aluminum. Steel prices are up about 60 per cent since the plans were approved in June, while construction materials costs overall are up about 50 per cent, according to government data. Fed staff also pointed to the complication of historic renovations — both buildings have significant preservation needs. Constructing a new building on an empty site would have been cheaper. The Fed has previously attributed much of the project's cost to underground construction. It is also adding three underground levels of parking for its second building. Initially, the central bank proposed building more above ground, but ran into Washington, DC's height restrictions, forcing more underground construction. When construction began in 2022, the Fed estimated the cost at $US1.9 billion ($A2.9 billion), and it has since grown by about 30 per cent. Trump wants Powell to dramatically slash the Fed's benchmark interest rate under the belief that inflation is not a problem, but Powell wants to see how Trump's tariffs impact the economy before making any rate cuts that could potentially cause inflation to accelerate. The renovation project has emerged as the possible justification by Trump to take the extraordinary step of firing Powell for cause, an act that some administration officials have played down, given that the Fed chair's term ends in May 2026. Pushing Powell out also would almost certainly jolt global markets, potentially having the opposite effect that Trump wants as he pushes for lower borrowing costs. When asked last week if the costly rebuilding could be grounds to fire Powell, Trump said, "I think it sort of is". Sign in to access your portfolio
The Advertiser
4 days ago
- Business
- The Advertiser
Trump to check out Federal Reserve's pricey renovations
President Donald Trump plans to step foot in the Federal Reserve as his allies scrutinise its expensive building renovations, a highly personal and confrontational escalation of his campaign to pressure the central bank to slash interest rates. Trump administration officials have used concerns about the building overhaul to cast doubt on Fed Chairman Jerome Powell's decision-making. They were scheduled to inspect the site on Thursday, and the White House announced late Wednesday that the president would also be visiting. The visit reflects Trump's disregard for the traditional independence of the Fed, which plays a foundational role in the American economy by setting monetary policy that is supposed to be free of political influence. While previous presidents have criticised the Fed's decisions, Trump's sustained campaign is an unusual and, his critics say, dangerous departure from the norm. He has called on Powell to resign, insulted him repeatedly and suggested he could be fired. More recently, Trump has said he has no plans to oust Powell, which could be illegal. Pushing Powell out also would send shockwaves through global markets, potentially having the opposite effect that Trump wants as he pushes for lower borrowing costs. Trump, a Republican, appointed Powell during his first term, and President Joe Biden, a Democrat, extended his tenure. Powell's term doesn't end until next May, and he's previously insisted that he will serve until then. Not everyone in Trump's administration agrees with the president's contention that Powell needs to resign. "There's nothing that tells me that he should step down right now," said Treasury Secretary Scott Bessent, whom Trump has floated as a potential replacement for Powell, in a recent interview with Fox Business. "He's been a good public servant." Trump has criticised Powell for months because the chair has kept the short-term interest rate the Fed controls at 4.3 per cent this year, after cutting it three times last year. Powell says the Fed wants to see how the economy responds to Trump's sweeping tariffs on imports, which Powell says could push up inflation. Powell's caution has infuriated Trump, who has demanded the Fed cut borrowing costs to spur the economy and reduce the interest rates the federal government pays on its debt. Trump will likely be disappointed again soon. A key Fed committee is expected to keep rates where they are when it meets next week. The Fed has been renovating its Washington headquarters and a neighbouring building. With some of the construction occurring underground and as building materials have soared in price after inflation spiked in 2021 and 2022, the estimated cost has ballooned from $US1.9 billion ($A2.9 billion) to about $US2.5 billion ($A3.8 billion). When asked last week if the costly rebuilding could be grounds to fire Powell, Trump said: "I think it sort of is". "When you spend $US2.5 billion ($A3.8 billion) on, really, a renovation. I think it's really disgraceful," Trump said. President Donald Trump plans to step foot in the Federal Reserve as his allies scrutinise its expensive building renovations, a highly personal and confrontational escalation of his campaign to pressure the central bank to slash interest rates. Trump administration officials have used concerns about the building overhaul to cast doubt on Fed Chairman Jerome Powell's decision-making. They were scheduled to inspect the site on Thursday, and the White House announced late Wednesday that the president would also be visiting. The visit reflects Trump's disregard for the traditional independence of the Fed, which plays a foundational role in the American economy by setting monetary policy that is supposed to be free of political influence. While previous presidents have criticised the Fed's decisions, Trump's sustained campaign is an unusual and, his critics say, dangerous departure from the norm. He has called on Powell to resign, insulted him repeatedly and suggested he could be fired. More recently, Trump has said he has no plans to oust Powell, which could be illegal. Pushing Powell out also would send shockwaves through global markets, potentially having the opposite effect that Trump wants as he pushes for lower borrowing costs. Trump, a Republican, appointed Powell during his first term, and President Joe Biden, a Democrat, extended his tenure. Powell's term doesn't end until next May, and he's previously insisted that he will serve until then. Not everyone in Trump's administration agrees with the president's contention that Powell needs to resign. "There's nothing that tells me that he should step down right now," said Treasury Secretary Scott Bessent, whom Trump has floated as a potential replacement for Powell, in a recent interview with Fox Business. "He's been a good public servant." Trump has criticised Powell for months because the chair has kept the short-term interest rate the Fed controls at 4.3 per cent this year, after cutting it three times last year. Powell says the Fed wants to see how the economy responds to Trump's sweeping tariffs on imports, which Powell says could push up inflation. Powell's caution has infuriated Trump, who has demanded the Fed cut borrowing costs to spur the economy and reduce the interest rates the federal government pays on its debt. Trump will likely be disappointed again soon. A key Fed committee is expected to keep rates where they are when it meets next week. The Fed has been renovating its Washington headquarters and a neighbouring building. With some of the construction occurring underground and as building materials have soared in price after inflation spiked in 2021 and 2022, the estimated cost has ballooned from $US1.9 billion ($A2.9 billion) to about $US2.5 billion ($A3.8 billion). When asked last week if the costly rebuilding could be grounds to fire Powell, Trump said: "I think it sort of is". "When you spend $US2.5 billion ($A3.8 billion) on, really, a renovation. I think it's really disgraceful," Trump said. President Donald Trump plans to step foot in the Federal Reserve as his allies scrutinise its expensive building renovations, a highly personal and confrontational escalation of his campaign to pressure the central bank to slash interest rates. Trump administration officials have used concerns about the building overhaul to cast doubt on Fed Chairman Jerome Powell's decision-making. They were scheduled to inspect the site on Thursday, and the White House announced late Wednesday that the president would also be visiting. The visit reflects Trump's disregard for the traditional independence of the Fed, which plays a foundational role in the American economy by setting monetary policy that is supposed to be free of political influence. While previous presidents have criticised the Fed's decisions, Trump's sustained campaign is an unusual and, his critics say, dangerous departure from the norm. He has called on Powell to resign, insulted him repeatedly and suggested he could be fired. More recently, Trump has said he has no plans to oust Powell, which could be illegal. Pushing Powell out also would send shockwaves through global markets, potentially having the opposite effect that Trump wants as he pushes for lower borrowing costs. Trump, a Republican, appointed Powell during his first term, and President Joe Biden, a Democrat, extended his tenure. Powell's term doesn't end until next May, and he's previously insisted that he will serve until then. Not everyone in Trump's administration agrees with the president's contention that Powell needs to resign. "There's nothing that tells me that he should step down right now," said Treasury Secretary Scott Bessent, whom Trump has floated as a potential replacement for Powell, in a recent interview with Fox Business. "He's been a good public servant." Trump has criticised Powell for months because the chair has kept the short-term interest rate the Fed controls at 4.3 per cent this year, after cutting it three times last year. Powell says the Fed wants to see how the economy responds to Trump's sweeping tariffs on imports, which Powell says could push up inflation. Powell's caution has infuriated Trump, who has demanded the Fed cut borrowing costs to spur the economy and reduce the interest rates the federal government pays on its debt. Trump will likely be disappointed again soon. A key Fed committee is expected to keep rates where they are when it meets next week. The Fed has been renovating its Washington headquarters and a neighbouring building. With some of the construction occurring underground and as building materials have soared in price after inflation spiked in 2021 and 2022, the estimated cost has ballooned from $US1.9 billion ($A2.9 billion) to about $US2.5 billion ($A3.8 billion). When asked last week if the costly rebuilding could be grounds to fire Powell, Trump said: "I think it sort of is". "When you spend $US2.5 billion ($A3.8 billion) on, really, a renovation. I think it's really disgraceful," Trump said. President Donald Trump plans to step foot in the Federal Reserve as his allies scrutinise its expensive building renovations, a highly personal and confrontational escalation of his campaign to pressure the central bank to slash interest rates. Trump administration officials have used concerns about the building overhaul to cast doubt on Fed Chairman Jerome Powell's decision-making. They were scheduled to inspect the site on Thursday, and the White House announced late Wednesday that the president would also be visiting. The visit reflects Trump's disregard for the traditional independence of the Fed, which plays a foundational role in the American economy by setting monetary policy that is supposed to be free of political influence. While previous presidents have criticised the Fed's decisions, Trump's sustained campaign is an unusual and, his critics say, dangerous departure from the norm. He has called on Powell to resign, insulted him repeatedly and suggested he could be fired. More recently, Trump has said he has no plans to oust Powell, which could be illegal. Pushing Powell out also would send shockwaves through global markets, potentially having the opposite effect that Trump wants as he pushes for lower borrowing costs. Trump, a Republican, appointed Powell during his first term, and President Joe Biden, a Democrat, extended his tenure. Powell's term doesn't end until next May, and he's previously insisted that he will serve until then. Not everyone in Trump's administration agrees with the president's contention that Powell needs to resign. "There's nothing that tells me that he should step down right now," said Treasury Secretary Scott Bessent, whom Trump has floated as a potential replacement for Powell, in a recent interview with Fox Business. "He's been a good public servant." Trump has criticised Powell for months because the chair has kept the short-term interest rate the Fed controls at 4.3 per cent this year, after cutting it three times last year. Powell says the Fed wants to see how the economy responds to Trump's sweeping tariffs on imports, which Powell says could push up inflation. Powell's caution has infuriated Trump, who has demanded the Fed cut borrowing costs to spur the economy and reduce the interest rates the federal government pays on its debt. Trump will likely be disappointed again soon. A key Fed committee is expected to keep rates where they are when it meets next week. The Fed has been renovating its Washington headquarters and a neighbouring building. With some of the construction occurring underground and as building materials have soared in price after inflation spiked in 2021 and 2022, the estimated cost has ballooned from $US1.9 billion ($A2.9 billion) to about $US2.5 billion ($A3.8 billion). When asked last week if the costly rebuilding could be grounds to fire Powell, Trump said: "I think it sort of is". "When you spend $US2.5 billion ($A3.8 billion) on, really, a renovation. I think it's really disgraceful," Trump said.
