Federal Reserve Governor Lisa Cook has filed a lawsuit against President Donald Trump after he announced her removal from office. Cook argues that the president has no legal authority to fire a Fed governor without proven cause, citing protections under the Federal Reserve Act of 1913.
Cook Challenges Trump’s Authority
In her lawsuit, filed in Washington D.C., Cook asked the court to declare Trump’s firing order “unlawful and void.” She also included Fed Chair Jerome Powell as a defendant, underscoring the seriousness of the challenge.
Trump justified his decision by alleging Cook committed mortgage fraud in 2021, but Cook maintains that the claim is unsubstantiated and does not meet the legal threshold for removal.
Fed’s Autonomy at Risk
The case raises major concerns about the independence of the U.S. central bank, which traditionally operates free from political interference. Analysts warn that Trump’s move could shake confidence in the Fed and add uncertainty to financial markets.
The U.S. dollar already dipped against other currencies after Trump’s announcement, fueling concerns of wider economic fallout.
Court Showdown Ahead
A federal judge has scheduled a hearing, with the dispute potentially heading to the Supreme Court. Cook insists she will continue her duties, saying, “I will continue to carry out my role to help the American economy.”
What’s at Stake
The lawsuit could become a landmark case, defining how much power a U.S. president has over the central bank. If Trump’s move succeeds, it could reshape the balance between the White House and the Federal Reserve for decades to come.
