President Donald Trump said he would fire Lisa Cook from the Federal Reserve's Board of Governors if she does not resign her post over mortgage-fraud accusations from a top White House ally.

"I'll fire her if she doesn't resign," Trump told reporters on Friday. 

The comments intensify Trump's pressure campaign against the US central bank, which he has bashed for months over its decision to hold interest rates steady. 

He's attacked Fed Chair Jerome Powell over monetary policy decisions as well as cost overruns for a major renovation of the bank's Washington headquarters. This week, he also took aim at Cook, who was appointed by former President Joe Biden to a term that runs until 2038.

Trump on Wednesday called for Cook's resignation after Federal Housing Finance Agency Director Bill Pulte alleged she committed mortgage fraud by lying on loan applications to secure favorable terms. Cook later responded, saying she would not be bullied into stepping down.

Section 10 of the Federal Reserve Act, the law that governs the central bank, says members of the Fed's Board of Governors can be "removed for cause." Trump has threatened to fire Powell several times this year. The Supreme Court indicated in May that he can't simply fire members of the Fed's Board of Governors, including Powell, without grounds.

Pulte said Thursday on Bloomberg Television that his referral of Cook to the Justice Department is part of a broader crackdown on mortgage fraud, adding that federal authorities would investigate the issue with no bearing on the political affiliation of its targets. 

If Cook is forced off the Fed board, it would give Trump the chance to shape it in his favor and exert more influence over US monetary policy. The move would also strike at the heart of the central bank's independence.  

An opening would pave the way for four of the seven slots on the Fed's board to be filled by Trump appointees. Trump appointed two of the current governors during his first term and nominated Stephen Miran — the chair of the Council of Economic Advisers — to fill another seat that was vacated this month by Biden appointee Adriana Kugler.

Pulte said Thursday on Bloomberg Television that his referral of Cook to the Justice Department is part of a broader crackdown on mortgage fraud, adding that federal authorities would investigate the issue with no bearing on the political affiliation of its targets. 

If Cook is forced off the Fed board, it would give Trump the chance to shape it in his favor and exert more influence over US monetary policy. The move would also strike at the heart of the central bank's independence.  

An opening would pave the way for four of the seven slots on the Fed's board to be filled by Trump appointees. Trump appointed two of the current governors during his first term and nominated Stephen Miran — the chair of the Council of Economic Advisers — to fill another seat that was vacated this month by Biden appointee Adriana Kugler.

Trump's warning Friday came as Powell was in the middle of highly anticipated remarks at the Fed's annual Jackson Hole economic symposium, where Cook was in attendance.

James Fishback, a Trump-aligned investor who has recently made headlines for suing the Fed, repeatedly yelled, "Governor Cook, why did you commit mortgage fraud?" as Cook entered the conference. Fishback was then removed from the lobby of the national park hotel where the gathering is held.

Source : Bloomberg