The Federal Reserve’s internal watchdog found no evidence of illegal behavior or administrative misconduct associated with the central bank’s nearly $2.5 billion project to overhaul its headquarters in Washington, D.C., even as it concluded that the renovations were poorly managed and lacked sufficient budget constraints. In a sweeping 120-page report, the Fed’s independent inspector general on Wednesday provided the most comprehensive overview to date of what caused extensive cost overruns on the project, which has been underway since 2022.

The report identified a range of missteps, including the Board of Governors’ failure to obtain a total cost estimate until the work was well underway or to establish a “guaranteed maximum price.” The project last year became a major front in President Trump’s campaign to pressure the Fed into lowering interest rates. Mr. Trump repeatedly criticized Jerome H. Powell, who served as Fed chair until May, for the cost overruns.

The inspector general’s report undermined the Justice Department’s investigation into whether Mr. Powell misled Congress about the project, which was abandoned in April. The watchdog found no wrongdoing by Mr. Powell or his colleagues. In a social media post on Wednesday, Mr. Trump said that Mr. Powell should be “forced to resign” from the board in the wake of the report.