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Federal Reserve Chair Jerome Powell has asked the U.S. central bank's inspector general to review the costs involved in the renovation of its historic headquarters in Washington, as Trump administration officials intensify their criticism of how the Fed is being run.

The request to Fed Inspector General Michael Horowitz, first reported by Axios, was made over the weekend, according to a source familiar with the matter.

It follows a letter to Powell last week from Office of Management and Budget Director Russell Vought, who wrote that President Donald Trump was "extremely troubled" by cost overruns in the $2.5 billion project. In material posted to its website on Friday, the Fed described the challenges in a complete rehabilitation of the nearly 100-year-old Marriner S. Eccles building and a neighboring property on Constitution Avenue in the nation's capital.

OMB has no oversight over the Fed, which funds its own operations separately from the appropriations process in Congress. The Federal Reserve Act also gives the central bank's seven-member Board of Governors control over its building and related projects, with oversight by Congress and the Fed's independent IG, which has been reviewing the renovations throughout the process.

But Vought's criticism marked an escalation by the Trump administration against Powell and the Fed more broadly. Trump has been angry over the central bank's refusal to cut interest rates on his timetable. Fed officials, however, have resisted cutting rates until there is clarity on whether Trump'stariffson U.S. trading partners reignite inflation.

Trump has said Powell should resign, but the president does not have the power to fire him over a monetary policy dispute.

Powell, who was nominated by Trump in late 2017 to lead the Fed and then nominated for a second term by then-President Joe Biden four years later, has said he intends to serve out his term as Fed chief, which ends on May 15.

A list of "frequently asked questions" about the project, posted by the Fed on Friday included several raised by Vought and also addressed by Powell during a recent hearing in Congress, when the Fed chief clarified, for example, that contrary to some press reports there were no private elevators being installed to carry Fed officials to a private dining room.

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

The neighboring site at 1951 Constitution Avenue, which dates to the administration of Roosevelt's predecessor, Herbert Hoover, had been used by a number of agencies before being turned over to the Fed in 2018 by the first Trump administration "enabling them to renovate this historic property," Trump's General Services Administration said in a press release at the time. "This transfer will put a vacant building back in productive use, allow the Federal Reserve Board to consolidate several leases and result in savings for taxpayers," it said.

Source: Reuters

The European Union accused the U.S. of resisting efforts to agree a trade deal and warned of countermeasures on Monday if no deal was struck to avoid the "absolutely unacceptable" tariffs President Donald Trump has threatened to impose from August 1.

Trump stepped up his trade war on Saturday, saying he would impose a 30% tariff on most imports from the EU and Mexico from next month, adding to similar warnings for other countries including Asian economic powerhouses Japan and South Korea.

The EU has so far held off on retaliatory measures to avoid a spiralling tit-for-tat escalation in the trade war while there remains a chance of negotiating an improved outcome.

But EU ministers emerging from a meeting in Brussels on Monday appeared closer to striking back.

Speaking at a news conference following the meeting, Danish Foreign Minister Lars Lokke Rasmussen called the tariff threat "absolutely unacceptable."

EU Trade Chief Maros Sefcovic, at the same press conference, said he believed there was "still a potential to continue the negotiations" but voiced frustration with Washington's failure to agree a deal with its largest trading partner.

"The EU ... never walks away without genuine effort, especially considering the hard work invested, how close we find ourselves to making a deal and the clear benefits of the negotiated solution," he said.

"But as I said before, it takes two hands to clap," he said, adding that EU member states agreed that the 27-nation bloc would need to take countermeasures if the trade negotiations with the U.S. fail.

Italy's Foreign Minister Antonio Tajani earlier said the EU had already prepared a list of tariffs worth 21 billion euros ($24.5 billion) on U.S. goods if the two sides fail to reach a deal.

White House economic adviser Kevin Hassett, meanwhile, said trade talks were still under way with the European Union, Canada and Mexico. Canada is facing a tariff of 35% from next month.

Asked about his expectations of talks with the EU, the White House National Economic Council director said: "We'll see ... we've got a few weeks left."

Hassett had said on Sunday that President Trump wanted to see better deals if the new tariffs are to be avoided.

GERMAN CONCERN

The threatened duties have sounded alarm bells in Europe, notably in Germany, the EU's biggest economy.

A U.S. flag flutters in front of shipping containers at the Port of Long Beach in Long Beach, California, U.S., July 11, 2025. REUTERS/Daniel Cole Purchase Licensing Rights, opens new tab

After Chancellor Friedrich Merz said on Sunday that a 30% tariff would "hit the German export industry to the core", the head of the German Chamber of Commerce and Industry called for swift action.

"The escalating tariff conflict with the USA poses a serious threat to many German companies," Volker Treier said on Monday. "Tough negotiations are now needed to avert a collapse of transatlantic trade."

European industries, meanwhile, are preparing for the worst.

Producers of Italy's renowned Chianti wine in Tuscany, for example, have demanded a new export strategy backed by the EU targeting alternative markets such as South America, Asia and Africa in response.

Since returning to the White House earlier this year, Trump has sought to use an array of tariffs to boost the U.S. economy, push companies to invest in the United States, and revitalise sectors including manufacturing.

His initial "Liberation Day" tariff announcement in April, which set a baseline tariff of 10% on all imports and higher duties on certain products or countries, raised fears of global supply chain disruptions, sending shockwaves through markets.

But subsequent U-turns and delays, including a 90-day pause on most duties aimed at allowing time for trade deal negotiations, have left investors largely inured to Trump's chaotic policy roll-outs.

European stocks fell on Monday, while U.S. futures pointed towards a lower Wall Street open in response to the latest salvo. European autos and alcohol stocks were among those hardest hit.

SCRAMBLE FOR DEALS

The looming August 1 deadline has set off a scramble by governments around the world to seal trade agreements.

South Korea's top trade envoy said on Monday it may be possible to strike an "in-principle" deal by the deadline and signalled that Seoul may be open to allowing the U.S. greater access to its agriculture markets, local media reported.

Minister for Trade Yeo Han-koo, who held high-level talks with U.S. officials last week, said South Korea was seeking to avoid "unfair" U.S. tariffs on sectors key to its industrial prowess that would undermine industrial cooperation with its main security ally and trading partner, media reports said.

"I believe it's possible to reach an agreement in principle in the U.S. tariff negotiations, and then take some time to negotiate further," the Newsis news agency quoted Yeo as telling local media reporters.

"Twenty days are not enough to come up with a perfect treaty that contains every detail," he added.

South Korea is in a race to reach a compromise trade pact in the hope of avoiding a 25% tariff slapped on its exports, the same level faced by Japan.

Source: Reuters

Source: Reuters

Source: kitco

Canadian wholesale trade staged a modest recovery in May, with sales edging higher thanks in part to a rebound in the motor vehicle sector and a slight easing in worries about trade tensions with the U.S.

Wholesale sales rose 0.1% from the month before to a seasonally adjusted 84.20 billion Canadian dollars, the equivalent of about $61.5 billion, Statistics Canada said Monday. The figure was considerably stronger than the data agency's advance estimate for 0.4% decline.

The modest increase marked the first rise in sales in three months following a revised drop of 2.2% in April, the sharpest fall since mid-2023. Still, including petroleum, oilseed and grain trade, and wholesale sales were again lower in May.

Sales were up for five of the seven wholesale sectors tracked by the data agency, led by an increase in personal and household goods following three consecutive monthly declines. Motor vehicle and parts sales were also solidly higher for the month.

In price-adjusted terms, headline sales were up 0.2% in May, an indication of an increase in the volume of sales.

Compared with a year earlier, nominal wholesale sales climbed 1.8%, while transactions on a volume basis were 0.6% higher, the data agency said.

The agency said feedback from wholesalers it surveyed indicated the affect of trade tensions eased slightly in May. The share of wholesalers that indicated ongoing trade issues had impacted their businesses fell to 36.9% for the month from 43.6% in April, with those affected pointing to higher prices and an increase in costs for raw materials, shipping or labor.

Wholesalers--the largest component of Canada's services sector--connect farmers or manufacturers that produce goods with companies and public institutions that use them. They also import goods from other countries and redistribute them within Canada. Statistics Canada previously estimated retail sales dropped 1.1% in May, which would mark the biggest decline in a year following rising sales the previous two months.

Canada's economy has weakened considerably since beginning the year on solid footing, as activity has been dampened by President Trump's new tariffs and uncertainty surrounding global trade. Projections suggest industry-level gross domestic product shrank 0.1% from the month before in May, matching the decline in April and setting the economy up for a modest contraction in the second quarter.

Trump ramped up pressure on Canada last week, with plans to increase the tariff on goods imported from Canada into the U.S. to 35% starting in August. Currently, there is a 25% levy on Canadian and Mexican goods that don't comply with the existing trade pact between the three countries, as well as sector-specific tariffs that apply to imports of items including steel, aluminum and autos produced outside the U.S.

Statistics Canada said inventories for wholesalers rose 0.8% in May from a month earlier to C$130.35 billion, led by increases in building materials and supplies, as well as personal and household goods.

Including sales by petroleum, oilseed and grain merchants--the headline measure Statistics Canada is transitioning to--wholesale sales for May were 0.5% lower at C$113.84 billion. Inventories on the same basis were down 0.3% from the prior month at C$141.4 billion.

Source: TradingView

EU under pressure

A compromise ahead?

Source :cnbc