A senior official from the Trump administration revealed on Friday that Federal Reserve Chair Jerome Powell is "considering resigning" as scrutiny intensifies over allegations that he misled Congress regarding the central bank's lavish renovations at its Washington, DC headquarters. The pressure for an investigation into this matter has escalated, with critics questioning the integrity of the Fed's spending habits.
Bill Pulte, the chair of government-backed mortgage lenders Fannie Mae and Freddie Mac, took to social media platform X to share that he has heard "reports" suggesting that Powell is contemplating stepping down. However, Pulte did not provide any supporting evidence for his claims. He expressed that such a decision would be beneficial for America, stating, "I think this will be the right decision for America, and the economy will boom." As the director of the Federal Housing Finance Agency, Pulte oversees both Fannie Mae and Freddie Mac but did not respond to The Post's request for further comments.
According to another senior government official, "high-level, credible sources" believe that Powell is indeed weighing the option of resigning from his position. This insider noted that Powell has been feeling significant pressure and has grown increasingly "fatigued" since The Post published a report in April detailing the extravagant $2.5 billion renovation of the Fed's DC offices, which Senator Tim Scott (R-SC) likened to the "Palace of Versailles." The source quoted, "Why would you stay at a party when no one wants you there?" highlighting the growing sentiment against Powell's leadership.
President Trump, who has often criticized Powell as "Too Slow" for not cutting interest rates, appointed three new members to the National Capital Planning Commission on Thursday. This body regulates federal development projects, and the recent changes are seen as another tactic to increase pressure on Powell to resign. A senior administration official suggested that this series of actions is part of a strategic game of "4D chess" orchestrated by the President and his allies, aimed at persuading Powell to step aside.
In response to the mounting criticism, a Federal Reserve spokesman declined to comment but referenced Powell's earlier remarks from April 4, where he stated his intention to complete his full term, which runs until May 2026. Powell has faced accusations from Pulte and others of misleading Congress, particularly during a June 25 Senate Banking Committee hearing where he defended the Fed's renovation project. He insisted, "There’s no VIP dining room. There’s no new marble. There are no special elevators," while denying other extravagant features.
However, Powell's statements have come under fire for contradicting the project’s own planning documents, which were approved by the National Capital Planning Commission in 2021. Additionally, the Office of Management and Budget chief, Russ Vought, publicly criticized Powell on Thursday for overseeing what he described as a "glorified vanity project," which saw costs increase by 30% from the initial estimate of $1.9 billion. In a letter to Powell, Vought expressed that the President is "extremely troubled by your management of the Federal Reserve System."
As the controversy continues to unfold, the Fed's next meeting is scheduled for the end of July, where market analysts predict that the current interest rate, set between 4.25% and 4.5%, will remain unchanged. Should Powell choose to resign, potential successors include Kevin Hassett, director of the National Economic Council, Treasury Secretary Scott Bessent, or former Fed Governor Kevin Warsh. However, a senior White House insider firmly stated, "There are no plans to change the Fed chair," suggesting that Powell may ultimately decide to stay in his role.
