Federal Reserve Clash: Lisa Cook Defies Trump, Declares She Will Not Resign

In a highly contentious development, Lisa Cook, a member of the Federal Reserve Board, stated that President Donald Trump lacks the legal authority to remove her from the US central bank, and she will not resign. This announcement is a direct response to Trump's declaration on his Truth Social platform that he had dismissed her "effective immediately."

In an official statement, Cook said, "President Trump has alleged that he has fired me (for cause) when there is no legal cause, and he has no authority to do so... I will not resign. I will continue to serve the American economy as I have since 2022."

Trump had called for Cook's resignation on August 20 after Bill Bolt, the director of the Federal Housing Finance Agency, accused her of alleged mortgage irregularities, claiming she had designated two of her mortgages as primary residences. In his message to Cook, Trump stated he had "concluded that there is sufficient cause to remove you from your position," citing "ample evidence" of false statements on her mortgage applications.

For his part, Jalal Qannas, an assistant professor at Qatar University's College of Economics, emphasized that the independence of the US Federal Reserve is a cornerstone of stability for both the American and global economies. In an interview with "Al Arabiya Business," Qannas explained that Trump's interference in the Fed's affairs, whether by attempting to dismiss members like Cook or through his continuous comments on the bank's decisions, threatens investor confidence in US markets and the dollar.

Qannas stressed that any harm to the Fed's independence would have a direct negative impact on Wall Street, asserting that the central bank will vigorously defend its autonomy as a pivotal element of the US economy's stability. He noted that the relationship between the Fed and the US administration has become more complex, as markets will question whether future monetary decisions are political responses to Trump's wishes or based on economic data.

Qannas also pointed out that Fed Chairman Jerome Powell's remarks at the Jackson Hole symposium showed an openness to a September interest rate cut, though he did not confirm it outright. Powell's decisions, Qannas added, will continue to be data-driven, especially since inflation has not yet been fully impacted by Trump's tariffs and trade policies.