Federal Reserve Drama: Trump's Controversial Move Faces Legal Hurdle

President Donald Trump's administration swiftly moved to appeal a federal judge's decision temporarily halting the firing of Federal Reserve Governor Lisa Cook, a first in U.S. history. The judge found insufficient grounds for dismissal based on allegations of past mortgage fraud, prompting the Department of Justice to act.

The case, likely headed to the U.S. Supreme Court, raises significant questions about the Federal Reserve's independence from political influence. The central bank's ability to set interest rates without external pressure is considered crucial for controlling inflation. Trump's demands for aggressive rate cuts reflect ongoing tensions between the White House and the Fed's leadership.

The law governing the Federal Reserve only allows governors to be removed "for cause," but lacks a clear definition of the term. No president has ever tested this in court until now. Cook, who denies any wrongdoing, claims her removal is politically motivated due to her monetary policy stance.

(With inputs from agencies.)