Trump vs. Fed: Lisa Cook's Name Involved
The U.S. Supreme Court on Wednesday, January 21, 2026, is scheduled to hear a case that could test the independence of the Federal Reserve (Fed). The issue is whether President Donald Trump can fire Fed Chair Lisa Cook while the lawsuit is still ongoing.
Officially, the hearing is about granting Trump "temporary" authority to fire Cook early. But many believe the implications are far greater, as the ruling could pave the way for Trump to exert more pressure on the Fed—including on Chairman Jerome Powell, who is considered not lowering interest rates fast enough.
The case also comes amid another spotlight: the Department of Justice (DOJ) is conducting a criminal investigation into Powell. This move has sparked strong reactions from both sides of the political spectrum, as it is seen as potentially destabilizing monetary policy and making the Fed appear to be under political pressure.
Trump has accused Cook of undermining the Fed's credibility due to alleged mortgage fraud in 2021—a claim Cook denies. He called the allegations baseless and based on "cherry-picked" documents, and insisted there was no evidence that he intentionally misinterpreted them.
Legal experts and bipartisan groups—including former Treasury officials and former central bankers—warned that Trump's victory could erode public confidence in the Fed. They argued that the central bank needs to be free from political influence to control inflation and maintain long-term economic stability.
The Supreme Court has previously signaled that the Fed holds a "unique" position compared to other independent institutions. But this time, the big question is simple: does the "can only be fired for legitimate reasons" protection truly protect Fed officials? If the answer is no, pressure on Trump to cut interest rates could increase—and global markets will be holding their breath awaiting the outcome. (alg)
Source: Newmaker.id
