According to reports, new evidence severely undercuts President Trump’s campaign to fire Fed Governor Lisa Cook. With the FOMC meeting a few days away, Trump probably won’t be able to change its composition in time.
The market is already confidently predicting that the Fed will cut US interest rates in the next few days. Still, Cook’s continued presence will maintain Fed independence and prevent Trump’s radical restructuring.
Documents Support Fed Governor
In the last few months, President Trump has considered drastic action to impose a cut to us interest rates, even aiming to fire Fed Chair Jerome Powell. Although Powell himself is finally open to rate cuts, Trump is still influencing Fed proceedings, attempting to fire Governor Lisa Cook in August. Sponsored
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Much like Powell himself, it is theoretically illegal for the President to fire any Fed Governors. If Trump is successful, he may be able to gain control over the FOMC.
This violation of Fed independence could have immense consequences, and it’s making industry observers extremely nervous:
However, according to a new report from Reuters, new evidence could help this Fed Governor maintain her position. The Trump administration’s complaints centered around accusations that she committed mortgage fraud.
Apparently, however, she declared the allegedly fraudulent property a vacation home, clearly showing that it was not intended to be her primary residence. This would prove that no mortgage fraud took place.
Reuters did not publish any of the relevant documents, but this evidence would undercut Trump’s pretext to fire her.
Could This Impact Rate Cuts?
So, why would crypto markets care about this issue? President Trump has been trying to fully oust Ms. Cook before the upcoming FOMC meeting. If he could replace her with a new Acting Fed Governor, that might have immediate repercussions for US rate cuts and other policies.
Still, the Fed was almost certain to cut interest rates already. It’s not that this evidence is necessarily bullish for crypto; more accurately, it prevents a bearish scenario.
Nonetheless, this is still quite significant. FOMC meetings influence token prices and whale activity, and drastic actions could change the whole market.
From where it looks right now, the Fed shouldn’t expect any major curveballs before the meeting takes place. The markets can probably anticipate a continued status quo, at least from this regulator.
