The U.S. Supreme Court has refused to allow President Donald Trump to immediately remove Federal Reserve Governor Lisa Cook, setting back his efforts to exert more control over the central bank. The Supreme Court's order means Cook can remain in her role at least until the justices hear oral arguments in the case in January, with a final decision expected by summer.
This decision allows Cook to participate in the remaining two Fed meetings in 2025, including the crucial interest rate-setting committee meeting scheduled for late October. Sources indicate that Cook has been on the job since late August, despite Trump's public announcement on Truth Social of her firing over allegations of mortgage fraud, which she vehemently denies.
U.S. District Judge Jia Cobb initially ruled that the administration had not met the legal requirement for firing a Fed governor "for cause," limiting such action to professional misconduct while in office. Judge Cobb also concluded that Trump's firing would have deprived Cook of her due process rights. The Supreme Court's current decision to delay her removal underscores the judiciary's role in safeguarding the independence of the Federal Reserve, a body designed to operate without day-to-day political interference. No president has ever fired a sitting Fed governor in the institution's 112-year history.
Trump's administration had appealed to the Supreme Court after a federal appeals court, by a 2-1 vote, rejected their request to proceed with Cook's firing. Legal experts, like Lev Menand from Harvard Law School, interpret the Supreme Court's action as freezing the status quo in favor of the Fed's independence. A bipartisan group of former Treasury secretaries, Federal Reserve chairs, and other experts have filed a brief arguing that allowing Trump to remove Cook would undermine public confidence in the Fed and jeopardize its ability to effectively set monetary policy.
