Lawyers clash over fate of Fed governor Trump tried to fire

August 29, 2025

In an emergency court hearing, President Donald Trump's attempt to fire Federal Reserve governor Lisa Cook was challenged but ended without a ruling. Cook's legal team requested a temporary restraining order to prevent her removal, arguing the president's action was unlawful, while Trump claimed constitutional authority to remove her based on alleged false mortgage statements. This case could potentially escalate to the Supreme Court with significant implications for the Federal Reserve's independence.

Who is affected

Federal Reserve governor Lisa Cook
The Federal Reserve as an institution
Investors in financial markets
The U.S. government (regarding borrowing costs)
Global financial markets that rely on U.S. interest rates

What action is being taken

Cook's lawyers are seeking a temporary restraining order to block her removal
A legal battle is unfolding between Cook and the Trump administration
The Justice Department is defending Trump's authority to remove Cook
The court is reviewing arguments about whether Trump had "cause" to remove Cook

Why it matters

The case has implications for the Federal Reserve's independence from political influence
If investors doubt the Fed's credibility, U.S. government borrowing costs could rise
Changes in U.S. borrowing costs would have global financial ripple effects
The outcome could affect how the Federal Reserve Act's provisions regarding removal "for cause" are interpreted
The case relates to Trump's pressure on the Fed regarding interest rate policies

What's next

No explicit next steps stated in the article

Read full article from source: BBC