As it stands, former President Donald Trump will soon be making his most consequential visit to the Federal Reserve. This would be the first time in almost 20 years that a sitting president has stepped foot inside the US central bank. We’re looking forward to this visit later this week. It’s only the fourth time in recent history that a sitting president has visited the Fed, further underscoring the historic nature of the event.
The previous presidential visit was in 2006. Back then, President George W. Bush was the one who showed up to Ben Bernanke’s swearing in as Fed chairman. Trump’s visit comes at an awkward time, with mounting pressure on Fed Chairman Jerome Powell. Since then, he has been under fire from the White House for his handling of a $2.5 billion renovation project at the central bank.
Consolidating operation, the often-delayed renovation was approved in 2017. In fact, this was happening at the very same time that Trump put Powell in charge of the bank. Trump has recently voiced his discontent with how the project has been managed, stating, “When you spend $2.5bn on really a renovation, I think it’s really disgraceful.”
Trump’s criticisms extend beyond the renovation project. He’s gone public to urge the Federal Reserve to lower interest rates. This step would help reduce the potentially huge borrowing cost for the US government. He contends that we need to take the burden off making mortgages and loans more expensive to average Americans by lowering interest rates.
Jerome Powell has been working to assuage these fears. The truth is that duh, the economy is strong enough for the Fed to panic and raise or lower rates on short notice. Powell further claims that we are past the crisis-level inflation, with one report recently showing a 2.7% rate of inflation in June.
Even considering their shared history, animosity between Trump and Powell has been undeniable since Trump exited the stage. The former president is not shy to express his displeasure with Powell’s performance. He’s denigrated Powell as a “numbskull,” a “stubborn mule,” and a “Trump hater.” These comments underscore the ongoing clash between the Trump administration and the Fed. In so doing, Trump is casting doubt on Powell’s effectiveness.
As Trump considers his divided cabinet on the eve of his first visit to the Federal Reserve, speculation begins on Powell’s chairmanship’s fate. Trump nominated Powell to the position in 2017. Later, when President Joe Biden renominated him, Powell’s term became guaranteed to extend through May of 2026. Trump himself has raised the prospect of firing Powell, adding to the heat and creating speculation on the Fed’s future course and governance.