ISTANBUL / WASHINGTON

The US government will appeal a court decision blocking President Donald Trump from dismissing Federal Reserve Governor Lisa Cook, the White House said on Tuesday.

“The President lawfully removed Lisa Cook for cause. The Administration will appeal this decision and looks forward to ultimate victory on the issue," said White House spokesman Kush Desai.

The statement provided to Anadolu followed an appeals court ruling Monday that determined Trump cannot fire Cook right before the central bank's policy meeting that will determine whether to cut interest rates.

The decision by the US Court of Appeals for the District of Columbia Circuit allows Cook to take part in the Fed's pivotal two-day policy meeting beginning Tuesday morning.

Trump said on Aug. 25 that he had fired Cook — the first Black woman to serve as a governor on the Federal Reserve Board — on allegations of mortgage fraud, but to date she does not face any charges. Cook immediately filed a lawsuit contesting the dismissal.

Last Thursday, the Trump administration filed an appeal requesting that the lower court's decision allowing Cook to remain at the Fed be suspended before its meeting.

Bill Pulte, director of the Federal Housing Finance Agency, first accused Cook of mortgage fraud. Trump critics said the allegations were false, politically motivated, and selective, part of Trump’s campaign pledge to use the federal government to go after his “enemies.”

Cook denied any wrongdoing, while her lawyers contend that Trump is only using Pulte's allegations as a pretext, seeking her removal as part of a campaign to push the Fed to lower interest rates.  

Fed Board of Governors and interest rates

The US president has also often criticized Fed Chair Jerome Powell for opposing rate cuts and publicly mused about firing the chair, though doing so before his term ends would break established norms.

Though he did not try to fire Powell, Trump did attempt to fire Cook, a Joe Biden appointee who has voted in tandem with Powell.

Of the Fed's seven governors, two have been chosen by Trump and are involved in interest rate-setting decisions. On Monday, the US Senate confirmed Stephen Miran, a controversial figure and one of Trump’s top economic advisers, to serve on the Fed’s Board of Governors.

The central bank will announce its interest rate decision on Wednesday, and is widely expected to cut the policy rate by 25 basis points, as the job market showed signs of weakening in the past few months. The federal funds rate currently stands in the range of 4.25% to 4.5%.

Trump has accused the Fed of cutting rates too slowly, also pushing it to make a larger cut this week than market expectations.