Trump vs. Cook: Who Wins?
US President Donald Trump has declared his readiness to face legal action after attempting to oust Fed Governor Lisa Cook over alleged mortgage fraud. The Federal Reserve has asserted it will respect any court ruling regarding Cook's lawsuit. This move is unprecedented in the Fed's 111-year history and has raised concerns about increased political pressure on monetary policy.
The legal stakes are high: if Cook's seat is indeed vacant, Trump will have the opportunity to appoint a majority of the seven-member Board of Governors—a rare opportunity for any president. A board composition more aligned with the White House is feared to alter the direction of communication and interest rate decisions going forward.
In the midst of this process, Trump has nominated Stephen Miran—a White House economist—as an acting chairman until January and has signaled that Miran could be considered to fill Cook's seat permanently. The Wall Street Journal also reported the name of David Malpass, a former World Bank president and close Trump ally, as an alternative candidate.
Going forward, the focus of markets and policymakers will be on Cook's legal path, the Fed's official stance, and the Senate nomination process. The results will determine the Fed's independence and the direction of monetary policy for the next few years—from interest rate decisions to the central bank's credibility in the eyes of global investors. ((ayu)
Source: Newsmaker.id
