Judge temporarily stops Trump from firing Fed governor
Plus, the BLS makes a significant downward revision to jobs numbers, and the president’s nominee to replace an ex-Fed official advances to a Senate vote.
Key points:
- Lisa Cook can continue to serve as a Fed governor as her court battle with President Donald Trump proceeds, a judge ruled. Trump sought to fire Cook last month.
- The U.S. economy added 911,000 fewer jobs between March 2024 and March 2025, a downward revision that could help make the case for cutting short-term interest rates.
- Trump nominee Stephen Miran is a step closer to gaining a seat on the Fed board. If confirmed quickly, he could join the Fed in time for its Sept. 16-17 meeting.
This week in Washington, D.C., a judge ruled that Federal Reserve Governor Lisa Cook — whom President Donald Trump attempted to fire last month — can keep her job as her lawsuit challenging her removal plays out in court.
A Senate committee has meanwhile advanced Trump's nominee to replace another Fed governor who resigned in early August.
The Fed will decide next week whether to cut short-term interest rates, a decision expected to be influenced in part by labor market data. In addition to the weak August jobs report released last week, the Bureau of Labor Statistics (BLS) has announced that the U.S. economy added over 900,000 fewer jobs than initially estimated between March 2024 and March 2025 — data that bodes well for a September rate cut.
Judge says Cook's lawsuit 'made a strong showing'
On Sept. 9, U.S. District Judge Jia Cobb granted Cook's request for a preliminary injunction as the lawsuit Cook filed on Aug. 28 against Trump, the Fed Board of Governors and Fed Chair Jerome Powell moves forward.
Cook sued to keep her job four days after Trump announced that he was firing her over mortgage fraud allegations. Cook has not been charged with or convicted of any crime, and her attorneys say "no cause exists" for her termination.
The allegations stem from mortgage applications Cook allegedly submitted in mid-2021, prior to when she started working at the Fed in 2022. Her current term is set to expire in 2038.
"Cook has made a strong showing that her purported removal was done in violation of the Federal Reserve Act's 'for cause' provision," Cobb wrote in her Sept. 9 memorandum opinion, adding that the provision "does not contemplate removing an individual purely for conduct that occurred before they began in office."
Trump's firing of Cook also likely violated her Fifth Amendment rights, Cobb wrote.
As a result of Cobb's ruling, Cook can remain in her role as Fed governor while her lawsuit proceeds. The Department of Justice filed an appeal on Sept. 10.
Nearly a million fewer jobs
According to the BLS, the U.S. added 911,000 fewer jobs than initially reported between March 2024 and March 2025. The BLS makes monthly and annual revisions to jobs numbers as the data it analyzes becomes more comprehensive over time.
The latest downward revision is higher than many economists expected. It follows last week's jobs report indicating the economy added 22,000 jobs in August — lower than the roughly 75,000 jobs economists had projected — and also made downward revisions to combined June and July jobs data.
Powell has said that the Fed closely monitors this data and that a weakening labor market could make the case for cutting rates. The Fed chair has already indicated that the Fed is open to a September rate cut.
Shortly after the BLS's Sept. 10 announcement, the Department of Labor Office of Inspector General said it will review how the BLS collects and reports economic data. Trump previously alleged without providing evidence that labor market data had been "manipulated for political purposes" by former BLS Commissioner Erika McEntarfer — whom he fired after the August jobs report's release.
Trump's Fed nominee advances to Senate vote
On Sept. 10, the Senate Banking Committee advanced Trump nominee Stephen Miran, the president's pick to replace former Fed Governor Adriana Kugler, in a party-line vote. Though a full Senate vote has not yet been announced, it's possible Miran — who currently serves as chairman of the White House's Council of Economic Advisers — could take his seat on the Fed's Board of Governors in time for its Sept. 16-17 meeting.
During Miran's confirmation hearing last week, Senate Democrats raised questions over his intent to take an unpaid leave of absence from his White House job rather than resign if he winds up finishing Kugler's term, which expires in January 2026. Trump's interest in securing a majority on the Fed was key to their concerns about the central bank's ability to maintain its independence.
"Dr. Miran's nomination is just the next phase of President Trump's very public months-long campaign to stack the Fed with loyalists," Sen. Elizabeth Warren of Massachusetts alleged.