WASHINGTON — In a significant legal decision, an appeals court has blocked the Trump administration’s attempt to remove Federal Reserve board member Lisa Cook. This decision arrives as President Trump seeks to influence the Fed to lower interest rates. The 2-1 ruling permits Cook to participate in the upcoming Federal Reserve meeting, where board members will discuss potential interest rate changes.
The Trump administration is expected to appeal this decision to the Supreme Court. Removing Cook and appointing a replacement could allow Trump to sway the Fed towards his economic goals.
Trump Nominee Approved
Appointed by former President Joe Biden, Cook is the first Black woman on the Fed board, serving a term until 2038. She has consistently opposed lowering interest rates since her 2022 appointment. The U.S. Senate narrowly confirmed Trump’s nominee, Stephen Miran, for another Fed position with a 48-47 vote. Although the Fed operates independently, Miran will continue leading the White House’s Council of Economic Advisers.
President Trump urged Federal Reserve Chair Jerome Powell on social media to “CUT INTEREST RATES, NOW, AND BIGGER THAN HE HAD IN MIND. HOUSING WILL SOAR!!!”
Appeals Court Splits
The appeals court decision saw D.C. Circuit Judge Gregory G. Katsas, appointed by Trump, dissenting from Biden appointees J. Michelle Childs and Bradley N. Garcia. A federal judge previously ruled to retain Cook, citing insufficient evidence of mortgage fraud and failing to meet the “just cause” requirement for dismissal.
Katsas supported the broad presidential authority for removing Fed members, a stance not shared by Childs and Garcia, who focused on the due process shortfalls in Cook’s case. The majority emphasized, “Cook’s due process claim is very likely meritorious,” bypassing the “for cause” interpretation.
Cook was referred to the Department of Justice by a Trump official over alleged improper mortgage-related paperwork. However, Reuters found no evidence of tax rule violations in Cook’s documentation.
