Federal Reserve Board Chairman Jerome Powell speaks during Federal Reserve Integrated Review of the Capital Framework for Large Banks Conference at the Federal Reserve in Washington, Tuesday, July 22, 2025. (AP Photo/Mark Schiefelbein)

WASHINGTON (AP) — President Donald Trump is visiting the Federal Reserve headquarters in Washington Thursday, a week after indicating that Fed chair Jerome Powell’s handling of an extensive renovation project on two Fed buildings could be grounds for firing.

Trump has criticized Powell for months because the chair has kept the short-term interest rate the Fed controls at 4.3% 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.

The Fed has been renovating its Washington headquarters and a neighboring 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 to about $2.5 billion, from $1.9 billion.

When asked last week if the costly rebuilding could be grounds to fire Powell, Trump said, “I think it is.”

“When you spend $2.5 billion on, really, a renovation, I think it’s really disgraceful,” Trump said.

Firing Powell would threaten the Fed’s independence, which has long been supported by most economists and Wall Street investors.