Esther Imonmion
US President Donald Trump has escalated his battle against the US central bank in a way that has startled Washington and global financial observers.
For months, Trump has complained about what he sees as the Federal Reserve’s unwillingness to lower interest rates, putting increasing pressure on Fed chair Jerome Powell and other top officials.
The White House has hinted at stronger measures, with Trump insisting he has constitutional powers to act directly if necessary.
Now, Trump has said he will immediately remove Federal Reserve official Lisa Cook from her position, declaring there was “sufficient reason” to believe she had made false statements on mortgage agreements.
In response, Cook has said Trump has no authority to fire her and she will not resign.
It is an unprecedented move for the president to dismiss a member of the central bank’s leadership, raising new concerns about the independence of the Federal Reserve.
Cook is one of seven members of the Fed’s board of governors, and in this position sits on the 12-member committee which is responsible for setting interest rates in the US.
She voted alongside Powell and most other members of the committee to maintain US interest rates at the Fed’s last rate-setting meeting at the end of July.
She was appointed by Trump’s predecessor, Joe Biden, in 2022 and is the first African American woman to serve in the role.
Trump’s decision to remove Cook will likely raise legal questions, with experts suggesting the White House will need to demonstrate – potentially in court – that it had sufficient reason to fire her.
“President Trump purported to fire me ‘for cause’ when no cause exists under the law, and he has no authority to do so,” Cook said in a statement.
“I will not resign. I will continue to carry out my duties to help the American economy as I have been doing since 2022,” she added.
“We will take whatever actions are needed to prevent attempted illegal action,” Cook’s lawyer, Abbe David Lowell, said.
The Federal Reserve has not yet commented on the president’s announcement, which he made late on Monday via his social media platform Truth Social.
He posted a letter addressed to Cook in which he informed her of his decision to remove her from the bank’s board of governors with immediate effect.
Trump has also repeatedly floated the possibility of firing Powell.