Fed's Powell asks for inspector general review of project criticized by Trump officials

By Howard Schneider

WASHINGTON (Reuters) -Federal Reserve Chair Jerome Powell has asked the U.S. cardinal bank's inspector wide to reappraisal the costs progressive successful the renovation of its historical office successful Washington, arsenic Trump medication officials intensify their disapproval of however the Fed is being run.

The petition to Fed Inspector General Michael Horowitz, archetypal reported by Axios, was made implicit the weekend, according to a root acquainted with the matter.

It follows a missive to Powell past week from Office of Management and Budget Director Russell Vought, who wrote that President Donald Trump was "extremely troubled" by outgo overruns successful the $2.5 cardinal project. In worldly posted to its website connected Friday, the Fed described the challenges successful a implicit rehabilitation of the astir 100-year-old Marriner S. Eccles gathering and a neighboring spot connected Constitution Avenue successful the nation's capital.

OMB has nary oversight implicit the Fed, which funds its ain operations separately from the appropriations process successful Congress. The Federal Reserve Act besides gives the cardinal bank's seven-member Board of Governors power implicit its gathering and related projects, with oversight by Congress and the Fed's autarkic IG, which has been reviewing the renovations passim the process.

But Vought's disapproval marked an escalation by the Trump medication against Powell and the Fed much broadly. Trump has been aggravated implicit the cardinal bank's refusal to chopped involvement rates connected his timetable. Fed officials, however, person resisted cutting rates until determination is clarity connected whether Trump's tariffs connected U.S. trading partners reignite inflation.

Trump has said Powell should resign, but the president does not person the powerfulness to occurrence him implicit a monetary argumentation dispute.

Powell, who was nominated by Trump successful precocious 2017 to pb the Fed and past nominated for a 2nd word by then-President Joe Biden 4 years later, has said helium intends to service retired his word arsenic Fed chief, which ends connected May 15.

A database of "frequently asked questions" astir the project, posted by the Fed connected Friday included respective raised by Vought and besides addressed by Powell during a caller proceeding successful Congress, erstwhile the Fed main clarified, for example, that contrary to immoderate property reports determination were nary backstage elevators being installed to transportation Fed officials to a backstage eating room.

The Eccles building, the Fed's main headquarters, was built during erstwhile President Franklin Delano Roosevelt's administration.

The neighboring tract astatine 1951 Constitution Avenue, which dates to the medication of Roosevelt's predecessor, Herbert Hoover, had been utilized by a fig of agencies earlier being turned implicit to the Fed successful 2018 by the archetypal Trump medication "enabling them to renovate this historical property," Trump's General Services Administration said successful a property merchandise astatine the time. "This transportation volition enactment a vacant gathering backmost successful productive use, let the Federal Reserve Board to consolidate respective leases and effect successful savings for taxpayers," it said.

(Reporting by Howard Schneider; Editing by Paul Simao)