The Supreme Court on Wednesday allowed Federal Reserve Governor Lisa Cook to remain in her post pending oral arguments in January on whether President Donald Trump has legal cause to fire her.
The court’s move is a blow to Trump, who has repeatedly and unsuccessfully asked federal courts to allow him to terminate Cook from the Fed’s Board of Governors without delay while her lawsuit challenging her removal is pending.
Trump has cited claims that Cook committed mortgage fraud as his reason for firing her from the seven-member board.
But his first effort to remove her in August came after he, for months, had unsuccessfully pressured her, Fed Chairman Jerome Powell, and other members of the central bank to cut interest rates
Cook denies any wrongdoing in connection with statements she made before joining the Fed in applying for mortgages on two homes she owns in Michigan and Georgia. She has not been legally charged with making false statements on those mortgage applications.
In its order on Wednesday, the Supreme Court bluntly said, without elaboration, that Trump’s request to stay a federal district court’s injunction against removing Cook is “deferred pending oral argument in January 2026.” The actual date of the argument was not set.
The order said that the Supreme Court’s clerk would establish a schedule for the filing of legal briefs in the case, including ones by outside parties who have an interest in the outcome.
The Trump administration’s effort to remove Cook is seen as a potential landmark case on whether to maintain the Fed’s long-held veneer of independence from political interference.
Trump has insisted that the accusations against Cook meet the standard of “cause” required by the Federal Reserve Act to remove a Fed official.
The Department of Justice in earlier filings had called the injunction barring Trump from firing Cook while her lawsuit is pending “yet another case of improper judicial interference with the President’s removal authority.
Cook’s lawyers, Abbe Lowell and Norm Eisen, in a statement after the Supreme Court issued its order, said, “The Court’s decision rightly allows Governor Cook to continue in her role on the Federal Reserve Board, and we look forward to further proceedings consistent with the Court’s order.”
White House spokesman Kush Desai, in a statement, said, “President Trump lawfully removed Lisa Cook for cause from the Federal Reserve Board of Governors.”
“We look forward to ultimate victory after presenting our oral arguments before the Supreme Court in January,” Desai said.
The Fed declined to comment other than restating its position that it will abide by any court decisions.
Wednesday’s order allows the Fed to conduct business as usual, at least through the end of the year.
Cook will vote at the Federal Open Market Committee’s October and December meetings, and possibly at the FOMC’s January meeting.
The FOMC in September voted to lower its benchmark borrowing rate by a quarter-percentage point.
In addition, officials indicated additional quarter-percentage-point reductions at each of the two remaining meetings this year.
Cook participated in the FOMC during that meeting over Trump’s protests.
She voted for the quarter-point cut, while Trump’s newest Fed governor appointment, Stephen Miran, dissented from the cut, saying he wanted a half-point reduction.
Miran also indicated in the committee’s “dot plot” of individual expectations that he wants to see another 1.25 percentage points lopped off the funds rate by the end of 2025.
Cook has not indicated a preference, though, like Powell, she has advocated a cautious approach to easing policy.
— CNBC’s Jim Forkin contributed to this story.