Washington DC - A government watchdog said Wednesday it found no grounds to pursue criminal charges over cost overruns in renovations of the Federal Reserve headquarters after President Donald Trump attempted to charge the central bank's chief over the issue.

"At no point during our evaluation did we find reasonable grounds to believe that a violation of federal criminal law had occurred requiring a referral to the US Attorney General in accordance with the Inspector General Act," the Office of the Inspector General of the Federal Reserve said in its report.

In April, the Department of Justice dropped a criminal probe into then-chairman Jerome Powell over the cost overruns, after Trump had frequently insulted and criticized him and called for the central bank chief to step down.

Trump had clashed with Powell over the path of interest rates, launching an unprecedented assault on the Fed's independence as he demanded the central bank cut rates to spur economic activity.

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The charges were dropped in April after a senator from Trump's own party refused to confirm the president's chosen successor to Powell, saying he would only do so if the criminal probe was stopped.

At the time, US Attorney Jeanine Pirro said she would bow to the Inspector General's findings.

The investigation centered around a major building renovation project at the Fed's Washington headquarters whose cost estimates grew from $1.3 billion in February 2020 to $2.4 billion in December 2024.

The OIG said that its probe found deficiencies in management of the renovation project, but "did not identify administrative misconduct during our evaluation."