President Trump told Reuters he currently has no plan to fire Federal Reserve Chair Jerome Powell despite a Justice Department criminal inquiry into $2.5 billion in renovation cost overruns at the Fed. Powell denies wrongdoing and says the probe may be political pressure over interest-rate decisions. Trump named Kevin Warsh and Kevin Hassett as possible successors and dismissed concerns that politicizing the Fed could harm the dollar or fuel inflation.
Trump Says He Has No Current Plan To Fire Fed Chair Powell Amid DOJ Probe
Federal Reserve Chair Jerome Powell arrives at the U.S. Federal Reserve in Washington, U.S., January 13, 2026. REUTERS/Nathan Howard
WASHINGTON — President Donald Trump told Reuters on Wednesday that he currently has no plan to remove Federal Reserve Chair Jerome Powell, even as the Justice Department pursues a criminal investigation into cost overruns on a $2.5 billion renovation project at the Fed’s headquarters. Trump added that it was "too early" to say what he might ultimately decide.
Investigation and Powell's Response
The Justice Department opened the probe into cost overruns for the renovation of two historic buildings at the Federal Reserve complex. Powell disclosed the investigation and has denied any wrongdoing, saying the unprecedented scrutiny may be intended to pressure him over his resistance to cutting interest rates to the president’s preferred levels.
Succession Talk
Powell’s term as Fed chair ends in May, though he could legally remain on the Fed’s Board of Governors until 2028. Trump said he was considering potential nominees and mentioned former Fed Governor Kevin Warsh and White House National Economic Council Director Kevin Hassett as possible successors. He said he had ruled out Scott Bessent for the role because "he wants to stay where he is."
Political Fallout and Criticism
Some Republican senators, alongside foreign economic officials, investors and former U.S. officials from both parties, have criticized the investigation as politicizing an institution whose independence is seen as vital for stable monetary policy. The Trump administration has defended opening the inquiry, saying it has a duty to investigate potential wrongdoing.
Trump brushed off critics who have warned that eroding central bank independence could weaken the U.S. dollar and stoke inflation, repeating, "I don't care," and urging political loyalty from lawmakers who will be asked to confirm any nominee he selects.
A Broader Test Of Presidential Authority
During his time in office, Trump has pushed the bounds of presidential authority. He has attempted to remove another Fed official, Governor Lisa Cook, who has challenged her termination in court; that case is scheduled for argument before the U.S. Supreme Court. "A president should have something to say about Fed policy," Trump said. "I made a lot of money with business, so I think I have a better understanding of it than Too Late Jerome Powell."
Reporting: Steve Holland and Trevor Hunnicutt. Editing: Dan Burns and Diane Craft.
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