Federal court bars Trump from removing Fed governor Lisa Cook

A federal appeals court has ruled that President Donald Trump cannot remove Federal Reserve governor Lisa Cook from her position.

The 2-1 decision issued on Monday ensures Cook will remain on the Fed board for its policy meeting, where rate cuts are expected later this week.

Trump announced in August his intent to dismiss Cook over alleged mortgage fraud—a claim she has denied—arguing he had authority under federal law to remove Fed governors only "for cause".

Cook, the first Black woman appointed as a Fed governor and a Biden nominee, sued the president in August, contending her forced removal was politically motivated due to her stance on monetary policy.

The ruling upholds longstanding provisions designed by Congress in 1913 to shield the Federal Reserve from political interference, as no president has ever succeeded in dismissing a Fed governor.

Legal experts say the administration will likely appeal to the Supreme Court, testing uncharted territory in the Fed's independence.

By blocking Cook's removal, the court reaffirmed the Fed's political independence and set a precedent on the limits of presidential power over regulatory bodies.

This topic was reported by BBC News.

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