By Jill McLaughlin
President Donald Trump indicated on March 19 that Federal Reserve Chair Jerome Powell was still under investigation over the $2.5 billion price tag to renovate the Federal Reserve’s Washington headquarters, after a federal judge blocked subpoenas issued to the Federal Reserve as part of a criminal investigation of Powell.
“He’s under investigation, because he’s building a building for hundreds of millions more than it’s supposed to cost,” Trump said during a press briefing with Japanese Prime Minister Sanae Takaichi in the Oval Office before their bilateral meeting.
Trump said the renovation is not only over budget but also behind schedule.
“I don’t know if former Federal Reserve Governor Kevin Warsh is ever going to be able to move into it. It’s been under construction for years,” Trump said.
Warsh, who Trump nominated on Jan. 30 to succeed Powell, is awaiting confirmation by the Senate.
Warsh’s hearing has faced significant delays in the Senate Banking Committee, obstructed mainly by Sen. Thom Tillis (R-N.C.), who has vowed to block the nomination until the Justice Department drops its investigation into Powell.
The president reiterated his belief that the renovation is “the most expensive ever” and shows “gross incompetence” on Powell’s part.
Trump also said he believed the cost overruns could point to criminality, but might be the fault of the contractor.
The Justice Department served the Fed with grand jury subpoenas in January related to Powell’s testimony in June 2025 about the central bank’s building renovation project.
In a March 13 ruling, Judge James Boasberg found that the subpoenas were intended to “harass and pressure” the central bank chief into lowering interest rates or to drive him from office so a more compliant successor could be installed.
Approved in 2017 and budgeted at $1.9 billion, the overhaul was later revised to $2.5 billion. The Federal Reserve’s Office of the Inspector General, an in-house watchdog, stated that the increase reflected higher labor and material costs, the discovery of asbestos and soil contamination, and extended construction schedules.
Powell has denied wrongdoing and accused the administration of using the probe as part of an intimidation campaign to ease monetary policy.
Trump has openly criticized Powell over his decisions not to lower interest rates at a time, saying that inflation has been low enough to do so, and that high interest rates have made it costly for business investment and for the United States to service its national debt.
On March 18, the Federal Reserve left rates unchanged—in a range of 3.5 percent to 3.75 percent—on March 18 for a second consecutive meeting as it monitored the oil shock from the Iranian conflict.
“Today, certainly, he should be lowering interest rates,” Trump said. “Who would not lower them? But he’s got Trump Derangement Syndrome. A lot of people have that. It’s not a curable disease.”
Powell said after the meeting, the Fed was in a difficult situation.
“We feel like our framework calls on us to balance the risks, and we feel like where we are now is just kind of on that borderline, the higher borderline of restrictive versus not restrictive,” he said.
Powell on March 18 told reporters he planned to remain head of the U.S. central bank until his successor is confirmed.
“That’s what we’ve done on several occasions, including involving me, and that’s what we’re going to do in this situation,” Powell said.
Powell’s term on the board doesn’t expire until early 2028. Powell hasn’t said whether he planned to leave the board before then.
Andrew Moran contributed to this report.
