Supreme Court cools on Trump’s bid to fire Fed governor

A rare show of unity from conservative and liberal justices at the United States Supreme Court suggests President Donald Trump may have overreached in his attempt to remove Federal Reserve Governor Lisa Cook, a case that cuts straight to the question of whether the central bank can remain politically independent.

After nearly two hours of arguments on Wednesday, the justices signalled little appetite for granting the Trump administration’s request to immediately lift a lower-court order blocking Cook’s dismissal while her legal challenge proceeds. Several appeared troubled not just by the process used to target Cook, but by the precedent such a firing could set for the economy and the Fed itself.

The case marks the latest clash between Trump and the judiciary since his return to office 12 months ago, reflecting his expansive view of presidential authority, and testing how far that power can reach into institutions traditionally shielded from politics.

During questioning, multiple justices pressed Solicitor General D John Sauer on why Cook was never given a formal opportunity to respond to allegations of mortgage fraud cited by Trump as grounds for her removal, claims she has firmly denied.

They also raised concerns about the potential market impact of a first-ever presidential firing of a sitting Fed governor, and whether such a move would undermine confidence in the central bank’s independence.

“This case is about whether the Federal Reserve will set key interest rates guided by evidence and independent judgment or will succumb to political pressure,” Cook said in a statement after the hearing. “For as long as I serve at the Federal Reserve, I will uphold the principle of political independence in service to the American people.”

Cook attended the arguments, as did Federal Reserve Chair Jerome Powell, underscoring the stakes for the institution.

Trump’s lawyers argue the allegations against Cook go to her “conduct, fitness, ability or competence to serve as a governor of the Federal Reserve”.

“The American people should not have their interest rates determined by someone who was, at best, grossly negligent in obtaining favourable interest rates for herself,” Sauer told the court. “Deceit or gross negligence by a financial regulator in financial transactions is cause for removal.”

Chief Justice John Roberts questioned whether Sauer’s argument would still justify immediate removal if the alleged mortgage issue, listing two properties as a principal residence, amounted to “an inadvertent mistake contradicted by other documents in the record”.

Sauer replied that even then, “it is quite a big mistake”.

Roberts pushed back: “We can debate that.”

Paul Clement, Cook’s attorney, framed the allegations as “at most an inadvertent mistake” involving a vacation property — not evidence of misconduct warranting removal.

Conservative Justice Samuel Alito also voiced unease about how the case has been handled.

“This has been done in a very cursory manner,” Alito said. “No court has ever explored those facts. Are the mortgage applications even in the record in this case?”

“There’s a million hard questions in this case,” he added.

Trump’s move against Cook is widely seen as the most serious threat to Fed independence since the central bank’s creation in 1913. The Federal Reserve Act allows governors to be removed only “for cause”, but does not define the term or spell out a process — a deliberate ambiguity meant to shield the institution from political interference.

Until now, no US president has attempted to fire a sitting Fed governor.

Cook has argued the allegations are a pretext for removing her over policy differences, as Trump intensifies pressure on the Fed to cut interest rates and publicly attacks Powell for moving too slowly.

The Supreme Court, which has a 6–3 conservative majority, is expected to issue a ruling by the end of June. For now, Cook remains in her post — and the court appears wary of opening a door that could permanently weaken the firewall between politics and monetary policy.