A federal judge has issued a ruling that temporarily blocks former President Donald Trump from firing Federal Reserve Governor Lisa Cook, marking a major defense of the central bank’s independence.
Judge Jia Cobb ruled that Trump’s attempt to remove Cook on the basis of old mortgage fraud allegations did not meet the legal threshold required under the Federal Reserve Act. The law only allows governors to be dismissed “for cause,” meaning misconduct during their current term, not claims from before Senate confirmation.
Cook, who made history in 2022 as the first Black woman appointed to the Fed Board, quickly filed a lawsuit after Trump announced her dismissal. She argued that the action was unconstitutional, politically motivated, and violated her right to due process. The court agreed, noting that Cook was given no notice or chance to defend herself.
The decision allows Cook to remain in her position and take part in the Fed’s upcoming policy meeting, where economists expect a possible rate cut. More importantly, the case highlights the legal boundaries around presidential power and reinforces the Fed’s autonomy in shaping monetary policy without political interference.
This is the first time in history that a president has attempted to remove a sitting Federal Reserve governor. The dispute is likely to continue, potentially reaching the Supreme Court, where it could set a precedent on the limits of executive authority over independent institutions.
For now, the ruling ensures stability within the Federal Reserve, signaling that courts are willing to protect the central bank from political pressure at a time when its policy decisions carry enormous weight for the global economy.
