(Reuters) -The spiraling cost of the Federal Reserve's years-long renovation of two historic buildings in Washington, D.C., has become the latest flashpoint in the Trump administration's escalating pressure campaign on Fed Chair Jerome Powell, whom Trump wants out of the central bank because he hasn't delivered the interest-rate cuts he wants.

Early trading on Wall Street is muted as markets appeared to calm after President Donald Trump walked back his earlier threats to fire Federal Reserve Chair Jerome Powell.

The Trump administration is toying with removing Jerome H. Powell as chair of the Federal Reserve, accusing him of mismanaging a multibillion-dollar update to its Washington headquarters.

There could be a revolt in global markets, including a possible collapse in the dollar and US bonds, if President Donald Trump were to take the unprecedented step of removing Federal Reserve Chair Jerome Powell from the helm of the central bank,

Gold prices dipped on Thursday, pressured by a firmer dollar and easing market tensions after U.S. President Donald Trump said it was "highly unlikely" he would dismiss Federal Reserve Chair Jerome Powell.

The president suggested he could attempt to remove the Fed chair for cause, arguing the central bank spent too much money on renovations of two historic office buildings.

The president floated the idea of firing the Fed chief to lawmakers, then said such a move was "very unlikely."

At around midday in the U.S. session on Wednesday, it looked like six months of verbal attacks on Fed Chair Jerome Powell from President Donald Trump for not cutting interest rates were about to reach boiling point - according to Bloomberg News, Powell would soon be fired.