Trump's Legal Battle Over Fed Governor's Removal
The Trump administration seeks a federal appeals court's approval to remove Federal Reserve Governor Lisa Cook, citing alleged mortgage fraud. The ongoing legal tussle questions the Fed's independence and is set to potentially reach the U.S. Supreme Court. Cook denies the allegations and remains in office for now.
On Thursday, former President Donald Trump's administration filed an appeal to a federal court, seeking permission to remove Federal Reserve Governor Lisa Cook from her position, despite a judge's previous ruling that Trump likely lacked the sufficient cause to do so.
The Department of Justice requested the U.S. Court of Appeals for the D.C. Circuit to temporarily halt U.S. District Judge Jia Cobb's decision, which presently blocks Cook's removal while her lawsuit proceeds. This decision reverberates through the financial sector, as it could affect the Federal Reserve's meeting in mid-September where interest rates are set to be evaluated.
Governor Cook, who has faced accusations from Trump and others of mortgage fraud prior to her central bank role, insists on her innocence and challenges the removal claim as a guise to rid her due to her monetary policy positions. The case underscores significant implications for the Federal Reserve's policy-making autonomy, as the principle of independence from political influence remains under scrutiny.
(With inputs from agencies.)
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