Democrats winning control of the US Senate has created a fresh hurdle for President Donald Trump’s efforts to remove Federal Reserve Governor Lisa Cook. The election result could make it difficult for Trump to appoint someone of his choice to replace Cook, even if he succeeds in removing her.
The Senate’s new Democratic majority gives the party the power to approve or reject Trump’s nominees for judges and heads of executive branch agencies. Cook has denied the allegations and challenged Trump’s decision in court. She was appointed to the Federal Reserve by former President Joe Biden. However, the Senate result may not completely stop Trump from trying to remove Cook. This means Trump will face a challenge when choosing Powell’s successor. His administration will need to nominate someone who can win the support of Senate Democrats.
Because it could struggle to get a replacement approved, jaret Seiberg, an analyst at TD Cowen, said the administration may think twice about firing her.
This includes appointments to the Federal Reserve Board of Governors, according to Jonathan Pingle, an economist at UBS, as noted by Yahoo Finance. Michael Feroli, chief US economist at JPMorgan, said removing Cook would not automatically allow Trump to appoint someone from his administration or a person who supports his policies. He said the Senate’s new political balance means that a vacant seat would not necessarily go to a Trump ally, according to Yahoo Finance. Loretta Mester, former president of the Federal Reserve Bank of Cleveland, said the election could reduce his chances of success but she was not convinced that it would prevent him from making another attempt. Otherwise, the seat could remain vacant if the Senate refuses to approve the nominee, according to Yahoo Finance.
