The move has caused widespread anger from Palestinian after Trump gave order in that direction few months ago.
The Trump administration announced in February that it would shift the American embassy from Tel Aviv to Jerusalem.
The announcement deepened anger across the Arab world, particularly among Palestinians who see East Jerusalem as the capital of their future state.
Trump had in December announced Washington’s recognition of Jerusalem as Israel’s capital.
Speaking in the White House, Trump said he had no regrets about the decision as he described nixing a $1 billion, 10-year plan to construct a brand new embassy in favour of a $300,000 to $400,000 makeover of part of an existing US consulate.
“I may go. I’m very proud of it,” Trump told reporters.
“It is going to be beautiful. And it will be somewhat temporary, but it could be for many years,” he said at a joint press conference with German leader Angela Merkel.