Supreme Court lets Fed governor Lisa Cook stay amid Trump fight

The Supreme Court on June 29 let Federal Reserve governor Lisa Cook keep her seat while she fights Donald Trump’s effort to remove her, preserving a barrier that helps keep mortgage rates, borrowing costs and inflation decisions insulated from direct White House pressure. The 5-4 order came as the justices also expanded presidential power over many other independent agencies, but drew a line around the central bank.

Trump purported to fire Cook in August 2025, making her the first Fed governor ever targeted for removal in the central bank’s 111-year history. He cited unproven mortgage fraud allegations. Cook denied the accusations and said they were a pretext for a dispute over monetary policy, not a genuine basis for dismissal.

The legal fight also turned on process. Cook argued that she did not receive the pretermination process required by statute and the Constitution. The Federal Reserve Act allows governors to be removed only for cause, but Congress never defined the term, leaving the court to weigh how far a president can go in trying to force out a central banker.

Cook was appointed by President Joe Biden in 2022 and, under the terms of her appointment, was due to serve until 2038. The court’s temporary block means she stays at the Federal Reserve Board of Governors while the case moves through the lower courts, leaving Trump without the immediate victory he sought.

Fed Chair Jerome Powell’s appearance at the Supreme Court oral arguments in January 2026 underscored how closely the central bank watched the case. The court said the United States has a long tradition of independent central banking, and by treating the Fed as an exception even as it broadened presidential authority elsewhere, the ruling signaled that the justices still see monetary independence as a distinct line the White House cannot easily cross.