QI Analysis CEO and chief strategist Danielle DiMartino Sales space discusses whether or not Fed Chair Jerome Powell is out of contact with the U.S. economic system on ‘Making Cash.’
Federal Reserve Chairman Jerome Powell returns to Capitol Hill on Wednesday for the second of two days of testimony. He’ll sit earlier than the Senate Banking Committee, the place he’s anticipated to face powerful questions from Republican and Democratic senators.
The looks follows Powell’s testimony Tuesday earlier than the Home Monetary Providers Committee, the place he addressed inflation, President Donald Trump’s proposed tariffs, and the outlook for rate of interest cuts.
Whereas these points are prone to stay in focus, Republican members of the Senate Banking Committee are additionally making ready to confront Powell about what they describe as extreme spending on the Federal Reserve and rising politicization throughout the company.
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In a letter obtained by FOX Enterprise forward of the listening to, a bunch of Republican senators led by Banking Committee Chairman Tim Scott, R-S.C., criticized the Fed’s deliberate renovations to its Washington, D.C. headquarters.
Senator Tim Scott, a Republican from South Carolina and chairman of Senate Banking, Housing, and City Affairs Committee, throughout a affirmation listening to in Washington, D.C., on Thursday, Feb. 27, 2025. (Al Drago/Bloomberg by way of Getty Photographs / Getty Photographs)
“On the similar time People are struggling to place meals on the desk, the Federal Reserve has been spending billions of {dollars} on the renovation of two of its places of work in Washington, D.C.,” the letter states.
The lawmakers cited media experiences describing the deliberate upgrades as extravagant, together with, “rooftop backyard terraces, ornate water options, new elevators that drop board members off instantly of their VIP eating suite, use of white marble, rooftop Italian beehives, and a personal artwork assortment within the basement.”
Initially projected to value $1.9 billion, the renovation finances has reportedly “ballooned” by 32%, bringing the brand new complete to $2.5 billion, the lawmakers allege.
“This lavish renovation is being accomplished at a time when the Federal Reserve has not made a revenue since 2022,” the lawmakers wrote, calling the upgrades pointless and out of contact.
The Marriner S. Eccles Federal Reserve constructing in Washington, DC, US, on Tuesday, June 25, 2024. (Ting Shen/Bloomberg by way of Getty Photographs / Getty Photographs)
A Federal Reserve spokesperson instructed FOX Enterprise, “We’ve obtained the letter and plan to reply.”
The company defended the renovation plans prior to now as essential to adjust to up to date constructing codes and know-how infrastructure wants.
Criticism of the Fed’s headquarters overhaul has drawn broader scrutiny, together with from Elon Musk when he was accountable for the Division of Authorities Effectivity (DOGE).
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“Since on the finish of the day, that is all taxpayer cash… we must always positively look to see if certainly the Federal Reserve is spending $2.5 billion on their inside designer,” Musk quipped to reporters earlier this yr, calling the mission “an eyebrow raiser.”
Past spending, Republicans are additionally anticipated to press Powell on what they describe as political bias throughout the Fed’s regulatory agenda, a priority they raised throughout Powell’s final go to to the committee in February.
Federal Reserve Board Chairman Jerome Powell holds a information convention following a Federal Open Market Committee assembly on June 18, 2025 in Washington, DC (Win McNamee/Getty Photographs / Getty Photographs)
Of their letter, senators urged the central financial institution to stay apolitical, writing, “The Federal Reserve lately has been vulnerable to political strain.”
They pointed to the company’s shifting stance on climate-related monetary points, noting that it joined the Community for Greening the Monetary System below President Biden, solely to exit the group after President Trump returned to workplace.
“The Federal Reserve is meant to be an company that performs a important function within the operate of our authorities and the worldwide economic system and due to this fact should be not solely fiscally accountable but in addition free from politics,” the letter states.
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Powell has typically harassed the non-political nature of the central financial institution’s financial coverage choices, explaining earlier this yr that the Fed is “strictly non-political.”
Powell is scheduled to start his testimony earlier than the Senate Banking Committee at 10 a.m. ET on Wednesday.