Trump Pressures Fed Again, Seeking Lower Interest Rates and Removal of Governor Cook

U.S. President Donald Trump is once again exerting pressure on the Federal Reserve to lower interest rates, a move that has sparked debate over the limits of presidential powers and the Fed's independence.

Trump has been reportedly calling new Fed Chair Kevin Warsh and publicly insisting on lower rates. He even went so far as to say he might fire Fed Governor Lisa Cook over allegations of mortgage fraud, which she denies.

The Federal Reserve Act provides for the removal of Board members by the president for cause, but courts have traditionally interpreted this to mean inefficiency, neglect of duty, or malfeasance in office. Since Cook's alleged violations occurred before her appointment to the Fed and are not directly related to her work, it remains disputed whether these grounds apply.

Trump's clearest lever over the Fed is his ability to appoint members of the Board of Governors to vacant positions and select candidates for leadership posts, including chair of the central bank.