President Donald Trump said Tuesday, August 12 he might allow "a major lawsuit against" the US central bank chief to proceed, as he complained again about renovations to the Federal Reserve headquarters and renewed pressure to lower interest rates. "The damage he has done by always being Too Late is incalculable," Trump wrote of Fed Chair Jerome Powell on his Truth Social platform. He added that he is thinking of allowing a lawsuit taking aim at Powell's oversight on the renovations in Washington, but did not offer more details.
Trump has repeatedly lashed out at Powell this year over the Fed's decisions to keep interest rates steady since its last cut in December. Policymakers have been cautiously monitoring the effects of Trump's wide-ranging tariffs on the world's biggest economy, as they mulled the right time to lower rates further. This is because it takes time for levies to filter through to consumer prices. The jury is still out on whether Trump's latest tariffs will have a one-off or longer-term impact on inflation, but the president has regularly pointed to benign data to urge for rate reductions to boost the economy.
Shortly after government data was released Tuesday, showing that consumer inflation stayed unchanged at 2.7% in July, Trump wrote on social media that Powell "must now lower the rate." He also called the Fed's leadership "complacent."
Trump has openly floated the idea of ousting Powell over cost overruns for the renovation. While the US leader says the price of the makeover was $3.1 billion, reiterating this figure in his social media post on Tuesday, Powell has been quick to correct Trump in the past. The cost has been put at $2.5 billion, but Trump's higher number includes work on another building that Powell maintains was completed previously. On Tuesday, Trump said Powell was doing a "horrible" job in managing the Fed's revamp.