Federal Reserve governor Lisa Cook will file a lawsuit challenging her removal by President Donald Trump, marking a significant escalation in the president's battle with the US central bank.
President Trump has no authority to remove Federal Reserve Governor Lisa Cook, her lawyer Abbe David Lowell said in a statement.
The president has stated there was sufficient reason to believe Cook made false statements on her mortgage, citing constitutional powers that he alleges permit his action.
This unprecedented move occurs as Trump intensifies pressure on the Fed, particularly its chair, Jerome Powell, regarding his discontent with the Fed's reluctance to lower interest rates.
Cook’s legal challenge stems from her assertion that Trump's attempt to fire her, based solely on a referral letter regarding an alleged mortgage issue, lacks factual or legal basis.
Since her appointment by Trump’s predecessor, Democrat Joe Biden, in 2022, Cook has been a prominent figure at the Fed, being the first African American woman to hold the position. Her potential removal could allow Trump to install a successor who aligns more closely with his economic agenda of lower interest rates.
While Cook has publicly asserted she will not resign, stating that she is dedicated to her role in enhancing the American economy, the situation raises serious questions about the integrity and independence of the Federal Reserve amidst political pressures.
