The US Supreme Court has ruled that President Donald Trump cannot immediately fire Lisa Cook, a governor of the Federal Reserve, in a 5-4 decision that affirms limits on presidential authority over the central bank. The court found that the president lacked the constitutional authority to remove Cook without cause, upholding procedural protections she was entitled to under statute.
Cook, a Biden appointee and the first Black woman to serve on the Federal Reserve Board, was abruptly dismissed by Trump via social media last August on allegations of mortgage fraud. She denied the claims and challenged her firing in court, arguing she was dismissed without proper cause. The Supreme Court’s ruling allows her to remain in her post while she contests the allegations.
The decision marks a departure from other recent rulings that granted Trump broad power to remove officials, including a Democratic commissioner from the Federal Trade Commission and a member of the National Labor Relations Board. The court has also limited lower courts’ ability to issue nationwide injunctions against Trump’s policies, but it appears determined to protect the Fed’s independence.
The case highlights ongoing tensions between the White House and the central bank over interest rate policy. Trump has repeatedly criticised the Fed for keeping rates too high, and his administration has investigated former chair Jerome Powell over renovation costs. Economists widely agree that an independent central bank is crucial for economic stability, and the ruling is seen as a victory for the Fed’s autonomy.
Cook is one of 12 board members who vote on interest rates eight times a year. Her term is scheduled to expire in 2038. The Supreme Court’s decision ensures she can continue to participate in those decisions while the legal dispute over her firing proceeds.
