In a significant legal development, the U.S. Supreme Court has ruled that Lisa Cook can retain her position as a Federal Reserve governor, marking a setback for former President Donald Trump in his ongoing dispute with the central bank. The court, in an unsigned order, rejected Trump’s request to immediately remove Cook and scheduled arguments regarding her dismissal for January. Trump had announced in August his intention to fire Cook over allegations of mortgage fraud, which she has vehemently denied. Cook swiftly filed a lawsuit, arguing that her removal was unlawful and could pave the way for political interference in the traditionally independent Federal Reserve. Historically, no president has attempted to remove a Fed governor, as such actions can only be justified ‘for cause,’ a term that remains undefined in the law. A federal judge had previously placed a stay on her dismissal, a decision now upheld by the Supreme Court. Cook, appointed by President Biden, plays a crucial role on the board that sets the Federal Reserve’s benchmark interest rate. The court’s ruling ensures she will participate in at least two more votes on potential rate cuts. Trump has accused Cook of falsifying a mortgage application prior to her appointment, but she contends that his real motive is her stance on monetary policy. The Federal Reserve recently announced its first rate cut in nearly a year, with Chair Jerome Powell emphasizing that the decision was driven by economic data rather than political pressure. The central bank’s ‘dual mandate’ focuses on controlling inflation and maximizing employment, with mortgage rates largely influenced by Treasury bond yields rather than direct Fed actions. Trump’s persistent criticism of the Fed and his unprecedented move to appoint White House economic adviser Stephen Miran to a temporary board vacancy underscore the ongoing tension between the administration and the central bank.