Hassett: Trump Could Potentially Fire Powell

President Trump could possibly fire Federal Reserve chair Jerome Powell over questions about the renovation of Fed facilities, National Economic Council director Kevin Hassett said Sunday.

The administration's relentless efforts to get Powell to either cut interest rates or leave have called the future independence of the central bank into question.

The mere threat of firing Powell caused a sell-off in markets earlier this year that sent interest rates soaring.

Trump said as recently as Friday he won't fire Powell, but Hassett's comments appear to crack the door open again.

The administration has ramped up pressure on the Fed over cost overruns for its headquarters renovation project, which Hassett said on ABC's "This Week" was $700 million over budget.

On Thursday, Office of Management and Budget head Ross Vought sent Powell a letter demanding answers to a series of questions about those overruns and project changes, and whether they complied with the law.

Fed watchers see the building issue as an administration effort to build a case to oust Powell for cause.

"I think whether the president decides to push down that road or not is going to depend a lot on the answers that we get to the questions that Russ Vought sent to the Fed," Hassett told ABC.

Asked if Trump has the authority to fire Powell, Hassett said: "That's a thing that's being looked into, but certainly, if there's cause, he does."

Hassett is widely seen as a leading contender to replace Powell, whose term as Fed chair expires in May.

Vought's July 10 letter gives Powell seven business days to respond, which takes him through the end of this week.

That would potentially give Trump time to attempt action before the next Fed meeting, which starts July 29.