Trump revives fight to oust Fed Governor ahead of looming rate cut

Donald Trump has renewed his effort to remove Federal Reserve Governor Lisa Cook, just days before the central bank is expected to announce its first interest rate hike in almost a year. 

Trump presses case to fire Fed Governor Cook

President Trump accused Cook of “deceitful and potentially criminal conduct,” claiming she misrepresented details about one of her mortgage properties and announced his decision to fire her in August 2025.

Cook immediately challenged her dismissal in court, contending that the President’s move to fire her violated her right to due process under U.S. law. She said that the president had exceeded his constitutional authority.

Judge Jia Cobb of the U.S. District Court issued a preliminary injunction less than two weeks later, on September 9, blocking Trump’s order and allowing Cook to retain her position as the case is in court.

The Department of Justice (DOJ) quickly filed a detailed brief in the U.S. Court of Appeals for the D.C. Circuit to appeal the district court’s decision. Government lawyers argued that the president can, by law, fire members of the Federal Reserve Board “for cause.” They said it’s part of his constitutional role, and Cook’s alleged misstatements still relate to her character and ability to exercise second judgment.

NBC News gave Cook’s defense a confidence boost when it filed a report questioning the government’s claims. The report claimed that a loan summary prepared in 2021 described Cook’s Atlanta property as a second home rather than her primary residence, which is consistent with how she disclosed it.

This small detail undermines the accusation that she misrepresented her property on mortgage applications. If this new evidence holds up in court, it will dismantle the prosecution’s case. It would also raise intense questions about whether Trump’s attempt to fire Cook was really about alleged misconduct or about exerting his political influence over the Federal Reserve. 

Fed moves toward first rate cut since last year

While Lisa Cook’s case unfolds, the Federal Reserve prepares to announce a big political change that investors, businesses, and ordinary households are eager about. The Central Bank is expected to lower interest rates on Wednesday.

Traders who monitor the Fed’s every move say policymakers could reduce rates by a quarter of a percentage point, and bring the benchmark range down to between 4.0 and 4.25 percent.

But the bigger question among economists and market analysts is what happens over the next few months. Chief economist at RSM, Joe Brusuelas, warned that while traders can expect one rate cut in September, three separate cuts before the end of the year are almost impossible. He said the Fed’s economic data doesn’t show enough weakness to support these immediate cuts. Other economists agree, saying the Fed could send the wrong message that inflation is over, when in reality, the economy hasn’t shown any signs that would push the central bank to ease interest rates quickly. 

At the same time, Washington and Wall Street are looking to the leadership of the Federal Reserve. Jerome Powell’s term as chair will end soon, so the attention is shifting to his possible successors, with a senior executive at BlackRock, Rick Rieder, emerging as the top contender.

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