WASHINGTON — Allies of President Donald Trump are renewing efforts to reshape the U.S. Federal Reserve following a Supreme Court ruling that blocked the administration's attempt to remove Federal Reserve Governor Lisa Cook, according to people familiar with the matter, intensifying a political campaign that has renewed debate over the central bank's independence.
The discussions include exploring legal and administrative avenues to replace members of the Federal Reserve's Board of Governors with presidential appointees, the people said, speaking on condition of anonymity because the deliberations are private. Cook remains a principal focus of the effort despite the court's decision allowing her to remain in office while legal proceedings continue, they said. Former Federal Reserve Chair Jerome Powell, who continues to serve as a governor, has also been discussed as a potential target.
The renewed push follows a closely watched Supreme Court ruling that rejected Trump's bid to immediately remove Cook, concluding that Federal Reserve governors are protected by statutory safeguards that limit presidential removal without cause. The decision reinforced longstanding legal protections designed to preserve the central bank's operational independence while returning aspects of the dispute to lower courts for further proceedings.
Trump said this week that his administration would continue pursuing Cook's removal through what he described as the proper legal process, signaling that the White House intends to keep challenging the issue despite the setback.
The Federal Reserve has long been structured to insulate monetary policy decisions from short-term political pressure. Governors serve lengthy terms that extend beyond presidential administrations, a framework intended to promote policy continuity and market confidence. Economists have frequently argued that central bank independence helps anchor inflation expectations and strengthen the credibility of monetary policy.
The debate comes as newly installed Federal Reserve Chair Kevin Warsh has emphasized that the institution will continue operating independently even while pursuing internal reviews of its communications and policymaking framework. Speaking this week at the European Central Bank's annual conference in Sintra, Portugal, Warsh underscored the importance of cooperation among central banks and reaffirmed the Fed's commitment to its inflation objectives.
No formal proposal to alter the Federal Reserve's statutory structure has been announced, and it remains unclear whether any broader changes would withstand legal scrutiny or gain sufficient political support. As of Friday, administration officials had not publicly outlined a timetable for any additional actions beyond continuing litigation involving Cook.
