Overview

• Cook filed suit in federal court in Washington seeking a declaration that Trump’s August 25 removal letter is void and that she remains a sitting governor, naming the president, the Fed Board and Chair Jerome Powell as defendants.
• Trump moved to oust Cook over mortgage fraud allegations first raised by FHFA Director Bill Pulte tied to 2021 loan applications, a matter the Justice Department is reviewing, and Cook has not been charged.
• The Federal Reserve said it will abide by any court decision and reiterated that long terms and removal protections for governors safeguard policy decisions from political interference.
• The outcome could reshape central bank independence and board dynamics, as Cook’s removal would let Trump nominate a replacement and pursue a voting majority more favorable to lower interest rates.
• Early rulings on a requested injunction could decide whether Cook continues to serve during the case, with emergency appeals possible and markets already showing sensitivity after the president’s announcement.