US Appeals Court Blocks Trump from Removing Fed Governor Lisa Cook

A US federal appeals court issued a ruling on September 16, 2025, preventing former President Donald Trump from removing Federal Reserve Governor Lisa Cook from her position. The decision, delivered by a three-judge panel in Washington, D.C., underscores the legal protections surrounding the Federal Reserve's independence and the tenure of its board members.

The court's opinion, published Monday morning, stated that the President does not have unilateral authority to dismiss a sitting Federal Reserve governor without cause. The panel cited statutory language and historical precedent, emphasizing that the central bank's structure is designed to insulate monetary policy from political interference. "The Federal Reserve Act provides clear terms for removal, and the President's power is not absolute in this context," the court wrote.

Legal and Political Implications

The case arose after Trump, in a public statement last week, announced his intention to remove Cook, citing disagreements over monetary policy and her recent votes on interest rates. Cook, who was appointed in 2022, has been a vocal advocate for maintaining the Fed's dual mandate of price stability and maximum employment. Legal experts note that the court's decision reaffirms the importance of central bank independence, a principle widely regarded as essential for economic stability.

White House officials expressed disappointment with the ruling, arguing that the President should have broader authority over executive branch appointments. However, several lawmakers from both parties welcomed the decision, with Senator Elizabeth Warren stating, "This is a victory for the rule of law and the integrity of our financial system."

Reactions from the Federal Reserve and Markets

Federal Reserve Chair Jerome Powell issued a brief statement supporting the court's decision, reiterating the Fed's commitment to its statutory responsibilities. Financial markets responded positively, with the Dow Jones Industrial Average rising 200 points in early trading, reflecting investor confidence in the central bank's continued independence.

International observers, including the European Central Bank and Bank of Japan, also welcomed the ruling, noting that central bank autonomy is a cornerstone of global financial stability. Analysts predict that the decision will set a precedent for future disputes over the removal of independent agency officials in the United States.

The case is expected to be closely watched as it may influence ongoing debates about the balance of power between the executive branch and independent regulatory agencies. Legal scholars anticipate that the ruling could be appealed to the Supreme Court, but for now, Lisa Cook will remain in her post as a Federal Reserve governor.