President Donald Trump created a committee to investigate Federal Reserve Governor Lisa Cook and recommend whether there is «cause» to remove her from office. The memorandum, dated October 7 and released by the White House on Friday, October 9, schedules a closed-door hearing at the White House for November 5, two days after the midterm elections.
Why it matters: the Federal Reserve sets interest rates that influence what consumers pay for mortgages, credit cards, and car loans. If a president can remove governors who participate in those decisions, investors may fear that monetary policy could become more vulnerable to political pressure.
The White House memorandum says the committee will advise the president on whether there is cause to remove Cook under the law governing the Federal Reserve, 12 U.S.C. §242, as interpreted by the Supreme Court in Trump v. Cook in 2026. The committee may consult with the Department of Justice.
Key dates:
Trump attempted to remove Cook in August 2025 after Federal Housing Finance Agency Director Bill Pulte accused her of making false statements in mortgage documents. Cook sued, and a federal court blocked her removal. In June of this year, the Supreme Court declined to lift that injunction, ruling that Cook was entitled to notice and an opportunity to respond before she could be removed. The court did not prevent Trump from beginning a new process that complies with those requirements. If Trump ultimately removes her again, the dispute is likely to return to court, CNBC noted.
Cook, who was appointed by former President Joe Biden, has a permanent vote on Federal Reserve interest-rate decisions as a member of the Board of Governors. Trump has criticized what he calls a «hostile» Fed, now chaired by Kevin Warsh, for not lowering interest rates.
At its September 16 meeting, the Fed raised its benchmark interest rate by a quarter percentage point, to a range of 3.75% to 4%, in a 12-0 vote, according to its official statement. The next meeting is scheduled for October 27 and 28.
The average rate on a 30-year fixed mortgage reached 7.40% on October 8, according to Freddie Mac's weekly survey. The committee investigating Cook does not directly change those rates, but uncertainty over the Fed's independence could affect the returns investors demand on longer-term debt.
Sources: White House, memo of October 7, 2026; Federal Reserve, statement of September 16; Federal Reserve, calendar; Freddie Mac PMMS; CNBC; NBC News. Data consulted on October 10, 2026.
