President Donald Trump on Monday said he might sue Federal Reserve Chair Jerome H. Powell for what the president called “gross incompetence,” injecting new tension into the already strained relationship between the White House and the independent central bank.
Speaking at a news conference beside Israeli Prime Minister Benjamin Netanyahu at Mar-a-Lago, Trump said “the guy is just incompetent.” Trump first brought up the Fed’s multibillion dollar renovation project — a renovation that at times has become a stand-in for Trump’s ongoing attacks on the Fed system.
“It’s gross incompetence against Powell,” Trump said, adding: “We’re going to probably bring a lawsuit against him.”
Trump threatened a “major lawsuit” against Powell over the summer, but he never followed through. It wasn’t clear what specific claims Trump was referring to Monday, or how or when a suit could be brought. The White House did not respond to a request for more information.
The Fed declined to comment.
The Fed’s renovation project isn’t the only way Trump has put pressure on the bank. White House officials and their allies routinely call for lower interest rates, even though monetary policy is supposed to be siloed off from politics. Trump has threatened to fire Powell and has tried to fire Federal Reserve governor Lisa Cook, setting up an ongoing legal battle over a president’s ability to remove central bankers.
Trump administration officials have alleged Powell either lied to Congress about the renovation or grossly mismanaged the project. Over the summer, when Trump’s criticism was most acute, the price tag for the project had swelled to nearly $2.5 billion, up from an estimate of $1.9 billion before the pandemic. The health crisis and ensuing economic upheaval caused materials like steel and cement to go up in price, the Fed has said.
Trump toured the renovations over the summer. But the visit proved surprisingly cordial, with Trump saying he wouldn’t fire Powell and wanted the project to continue. At one point, Powell held his ground and fact-checked Trump’s comments that the renovation had cost more than $3 billion.
Andrew Ackerman contributed to this report.
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